Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 14, 2020 | Jun. 28, 2019 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity File Number | 001-32903 | ||
Entity Registrant Name | Western Union CO | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-4531180 | ||
Entity Address, Address Line One | 7001 East Belleview Avenue | ||
Entity Address, City or Town | Denver | ||
Entity Address, State or Province | CO | ||
Entity Address, Postal Zip Code | 80237 | ||
City Area Code | 866 | ||
Local Phone Number | 405-5012 | ||
Title of 12(b) Security | Common Stock, $0.01 Par Value | ||
Trading Symbol | WU | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 8.4 | ||
Entity Common Stock, Shares Outstanding | 413,122,401 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001365135 | ||
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME/(LOSS) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF INCOME/(LOSS) | |||
Revenues | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Type of Revenue | us-gaap:ServiceMember | us-gaap:ServiceMember | us-gaap:ServiceMember |
Expenses: | |||
Cost of services. | $ 3,086.5 | $ 3,300.8 | $ 3,353 |
Type of Cost of Service | us-gaap:ServiceMember | us-gaap:ServiceMember | us-gaap:ServiceMember |
Selling, general, and administrative | $ 1,271.6 | $ 1,167 | $ 1,231.5 |
Goodwill impairment charge | 0 | 0 | 464 |
Total expenses | 4,358.1 | 4,467.8 | 5,048.5 |
Operating income | 934 | 1,122.1 | 475.8 |
Other income/(expense): | |||
Gain on divestitures of businesses (Note 4) | 524.6 | ||
Interest income | 6.3 | 4.8 | 4.9 |
Interest expense | (152) | (149.6) | (142.1) |
Other income, net | 8.5 | 14.1 | 8.9 |
Total other income/(expense), net | 387.4 | (130.7) | (128.3) |
Income before income taxes | 1,321.4 | 991.4 | 347.5 |
Provision for income taxes (Note 11) | 263.1 | 139.5 | 904.6 |
Net income/(loss) | $ 1,058.3 | $ 851.9 | $ (557.1) |
Earnings/(loss) per share: | |||
Basic (USD per share) | $ 2.47 | $ 1.89 | $ (1.19) |
Diluted (USD per share) | $ 2.46 | $ 1.87 | $ (1.19) |
Weighted-average shares outstanding: | |||
Basic (shares) | 427.6 | 451.8 | 467.9 |
Diluted (shares) | 430.9 | 454.4 | 467.9 |
CONSOLIDATED STATEMENTS OF IN_2
CONSOLIDATED STATEMENTS OF INCOME/(LOSS) (Parentheticals) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF INCOME/(LOSS) | |||
Related party expenses | $ 57.1 | $ 57.6 | $ 65.9 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) | |||
Net income/(loss) | $ 1,058.3 | $ 851.9 | $ (557.1) |
Other comprehensive income/(loss), net of reclassifications and tax (Note 14): | |||
Unrealized gains/(losses) on investment securities | 25.8 | (4.3) | 6.5 |
Unrealized gains/(losses) on hedging activities | (11) | 50.3 | (74.4) |
Foreign currency translation adjustments | (19.5) | (6.2) | |
Defined benefit pension plan adjustments | 7.2 | 1.8 | 9 |
Total other comprehensive income/(loss) | 22 | 28.3 | (65.1) |
Comprehensive income/(loss) | $ 1,080.3 | $ 880.2 | $ (622.2) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 1,450.5 | $ 973.4 |
Settlement assets | 3,296.7 | 3,813.8 |
Property and equipment, net of accumulated depreciation of $616.5 and $702.4, respectively | 186.9 | 270.4 |
Goodwill | 2,566.6 | 2,725 |
Other intangible assets, net of accumulated amortization of $961.5 and $1,047.6, respectively | 494.9 | 598.2 |
Other assets (Note 10) | 762.9 | 616 |
Total assets | 8,758.5 | 8,996.8 |
Liabilities: | ||
Accounts payable and accrued liabilities | 601.9 | 564.9 |
Settlement obligations | 3,296.7 | 3,813.8 |
Income taxes payable | 1,019.7 | 1,054 |
Deferred tax liability, net | 152.1 | 161.1 |
Borrowings | 3,229.3 | 3,433.7 |
Other liabilities (Note 10) | 498.3 | 279.1 |
Total liabilities | 8,798 | 9,306.6 |
Commitments and contingencies (Note 6) | ||
Stockholders' deficit: | ||
Preferred stock, $1.00 par value; 10 shares authorized; no shares issued | ||
Common stock, $0.01 par value; 2,000 shares authorized; 418.0 shares and 441.2 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively | 4.2 | 4.4 |
Capital surplus | 841.2 | 755.6 |
Accumulated deficit | (675.9) | (838.8) |
Accumulated other comprehensive loss | (209) | (231) |
Total stockholders' deficit | (39.5) | (309.8) |
Total liabilities and stockholders' deficit | $ 8,758.5 | $ 8,996.8 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) shares in Millions, $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Accumulated Depreciation on Property Plant and Equipment | $ 616.5 | $ 702.4 |
Accumulated Amortization on Other Intangible Assets | $ 961.5 | $ 1,047.6 |
Stockholders' Equity: | ||
Preferred stock, par value (USD per share) | $ 1 | $ 1 |
Preferred stock, shares authorized | 10 | 10 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 2,000 | 2,000 |
Common stock, shares issued | 418 | 441.2 |
Common stock, shares outstanding | 418 | 441.2 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash flows from operating activities | |||
Net income/(loss) | $ 1,058.3 | $ 851.9 | $ (557.1) |
Adjustments to reconcile net income/(loss) to net cash provided by operating activities: | |||
Depreciation | 79.6 | 76.9 | 77.1 |
Amortization | 178.1 | 187.8 | 185.8 |
Goodwill impairment charge (Note 5) | 0 | 0 | 464 |
Gain on divestitures of businesses, excluding transaction costs (Note 5) | (532.1) | ||
Deferred income tax provision/(benefit) (Note 11) | (24.5) | (15.1) | 69.5 |
Other non-cash items, net | 118.4 | 66.2 | 124.2 |
Increase/(decrease) in cash, excluding the effects of acquisitions and divestitures, resulting from changes in: | |||
Other assets | 7.5 | (31) | (62.5) |
Accounts payable and accrued liabilities (Note 6) | 94.3 | (126.5) | (417.6) |
Income taxes payable (Note 11) | (36.8) | (193.1) | 850.4 |
Other liabilities | (28.2) | 4.2 | 8.2 |
Net cash provided by operating activities | 914.6 | 821.3 | 742 |
Cash flows from investing activities | |||
Payments for capitalized contract costs | (46.6) | (150.3) | (74.8) |
Payments for internal use software | (33) | (52) | (33.2) |
Purchases of property and equipment | (48.1) | (136.7) | (69.1) |
Proceeds from divestitures of businesses, net of cash divested (Note 5) | 711.7 | ||
Acquisition of business, net | (24.9) | ||
Purchases of non-settlement related investments and other | (6.8) | (24.2) | (192.1) |
Proceeds from maturity of non-settlement related investments and other | 23.4 | 13.7 | 203.8 |
Purchases of held-to-maturity non-settlement related investments | (1.3) | (2.8) | (42.7) |
Proceeds from held-to-maturity non-settlement related investments | 33 | 23.5 | 28.4 |
Net cash provided by/(used in) investing activities | 632.3 | (328.8) | (204.6) |
Cash flows from financing activities | |||
Cash dividends paid | (340.8) | (341.7) | (325.6) |
Common stock repurchased (Note 14) | (552.6) | (412.4) | (502.8) |
Net proceeds from commercial paper | 120 | 125 | |
Net proceeds from issuance of borrowings | 495.9 | 685.4 | 746.2 |
Principal payments on borrowings | (824.9) | (414.4) | (500) |
Proceeds from exercise of options | 36.7 | 10.1 | 13 |
Other financing activities | (4.1) | (9.2) | (1.3) |
Net cash used in financing activities | (1,069.8) | (357.2) | (570.5) |
Net change in cash, cash equivalents, and restricted cash | 477.1 | 135.3 | (33.1) |
Cash, cash equivalents, and restricted cash at beginning of year | 979.7 | 844.4 | 877.5 |
Cash, cash equivalents, and restricted cash at end of year | 1,456.8 | 979.7 | 844.4 |
Supplemental cash flow information: | |||
Interest paid | 151.3 | 142.5 | 128 |
Income taxes paid/(refunded) | 318.9 | 339.4 | (11.6) |
Cash paid for lease liabilities | 53.8 | ||
Non-cash lease liabilities arising from obtaining right-of-use assets (Note 13) | 269.1 | ||
Restricted cash at end of year (included in Other assets) | $ 6.3 | $ 6.3 | $ 6.2 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY/(DEFICIT) - USD ($) shares in Millions, $ in Millions | Common Stock | Capital Surplus | Retained Earnings/(Accumulated Deficit) | Accumulated Other Comprehensive Loss | Total |
Beginning balance at Dec. 31, 2016 | $ 4.8 | $ 640.9 | $ 419.3 | $ (162.8) | $ 902.2 |
Beginning balance (shares) at Dec. 31, 2016 | 481.5 | ||||
Increase/(Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income/(loss) | (557.1) | (557.1) | |||
Stock-based compensation | 43.9 | 43.9 | |||
Common stock dividends and dividend equivalents declared | (325.6) | (325.6) | |||
Repurchase and retirement of common shares | $ (0.2) | (502.5) | (502.7) | ||
Repurchase and retirement of common shares (shares) | (25.7) | ||||
Shares issued under stock-based compensation plans | 13 | 13 | |||
Shares issued under stock-based compensation plans (shares) | 3.2 | ||||
Other comprehensive income (loss) (Note 14) | (65.1) | (65.1) | |||
Ending balance at Dec. 31, 2017 | $ 4.6 | 697.8 | (965.9) | (227.9) | (491.4) |
Ending balance (shares) at Dec. 31, 2017 | 459 | ||||
Increase/(Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income/(loss) | 851.9 | 851.9 | |||
Stock-based compensation | 47.7 | 47.7 | |||
Common stock dividends and dividend equivalents declared | (341.7) | (341.7) | |||
Repurchase and retirement of common shares | $ (0.2) | (413.8) | (414) | ||
Repurchase and retirement of common shares (shares) | (20.9) | ||||
Shares issued under stock-based compensation plans | 10.1 | 10.1 | |||
Shares issued under stock-based compensation plans (shares) | 3.1 | ||||
Other comprehensive income (loss) (Note 14) | 28.3 | 28.3 | |||
Ending balance at Dec. 31, 2018 | $ 4.4 | 755.6 | (838.8) | (231) | $ (309.8) |
Ending balance (shares) at Dec. 31, 2018 | 441.2 | 441.2 | |||
Increase/(Decrease) in Stockholders' Equity [Roll Forward] | |||||
Adoption of new accounting pronouncements | 30.7 | (31.4) | $ (0.7) | ||
Net income/(loss) | 1,058.3 | 1,058.3 | |||
Stock-based compensation | 48.9 | 48.9 | |||
Common stock dividends and dividend equivalents declared | (342.6) | (342.6) | |||
Repurchase and retirement of common shares | $ (0.2) | (552.8) | (553) | ||
Repurchase and retirement of common shares (shares) | (27.6) | ||||
Shares issued under stock-based compensation plans | 36.7 | 36.7 | |||
Shares issued under stock-based compensation plans (shares) | 4.4 | ||||
Other comprehensive income (loss) (Note 14) | 22 | 22 | |||
Ending balance at Dec. 31, 2019 | $ 4.2 | $ 841.2 | $ (675.9) | $ (209) | $ (39.5) |
Ending balance (shares) at Dec. 31, 2019 | 418 | 418 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY/(DEFICIT) (Parentheticals) - $ / shares | 3 Months Ended | |||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | |
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY/(DEFICIT) | ||||||||||||
Common stock dividends (USD per share) | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.175 | $ 0.175 | $ 0.175 | $ 0.175 |
Business and Basis of Presentat
Business and Basis of Presentation | 12 Months Ended |
Dec. 31, 2019 | |
Business and Basis of Presentation | |
Business and Basis of Presentation | 1. Business and Basis of Presentation Business The Western Union Company (“Western Union” or the “Company”) is a leader in global money movement and payment services, providing people and businesses with fast, reliable, and convenient ways to send money and make payments around the world. The Western Union ® The Western Union business consists of the following segments: ● Consumer-to-Consumer - The Consumer-to-Consumer operating segment facilitates money transfers between two consumers, primarily through a network of third-party agents. The Company’s multi-currency money transfer service is provided through one interconnected global network where a money transfer can be sent from one location to another, around the world. This service is available for international cross-border transfers and, in certain countries, intra-country transfers. This segment also includes money transfer transactions that can be initiated through websites and mobile devices . ● Business Solutions - The Business Solutions operating segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises, and other organizations and individuals. The majority of the segment’s business relates to exchanges of currency at spot rates, which enable customers to make cross-currency payments. In addition, in certain countries, the Company writes foreign currency forward and option contracts for customers to facilitate future payments. All businesses and other services that have not been classified in the above segments are reported as Other, which primarily includes the Company’s cash-based and electronic-based bill payment services which facilitate payments from consumers to businesses and other organizations. In May 2019, the Company sold a substantial majority of its United States based bill payments services, as discussed in Note 5. The Company’s money order and other services, in addition to certain corporate costs such as costs related to strategic initiatives, including costs for the review and closing of mergers, acquisitions, and divestitures, are also included in Other. See Note 18 for further information regarding the Company’s segments. There are legal or regulatory limitations on transferring certain assets of the Company outside of the countries where these assets are located. However, there are generally no limitations on the use of these assets within those countries. Additionally, the Company must meet minimum capital requirements in some countries in order to maintain operating licenses. As of December 31, 2019, the amount of these net asset limitations totaled approximately $610 million. Various aspects of the Company’s services and businesses are subject to United States federal, state, and local regulation, as well as regulation by foreign jurisdictions, including certain banking and other financial services regulations. Basis of Presentation The financial statements in this Annual Report on Form 10-K are presented on a consolidated basis and include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated. Consistent with industry practice, the accompanying Consolidated Balance Sheets are unclassified due to the short-term nature of the Company’s settlement obligations contrasted with the Company’s ability to invest cash awaiting settlement in long-term investment securities. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. Principles of Consolidation The Company consolidates financial results when it has a controlling financial interest in a subsidiary via voting rights or when it has both the power to direct the activities of an entity that most significantly impact the entity’s economic performance and the ability to absorb losses or the right to receive benefits of the entity that could potentially be significant to the entity. The Company utilizes the equity method of accounting when it is able to exercise significant influence over an entity’s operations, which generally occurs when the Company has an ownership interest between 20% and 50%. Earnings/(Loss) Per Share The calculation of basic earnings/(loss) per share is computed by dividing net income/(loss) available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Outstanding options to purchase Western Union stock and unvested shares of restricted stock are excluded from basic shares outstanding. Diluted earnings/(loss) per share reflects the potential dilution that could occur if outstanding stock options at the presented dates are exercised and shares of restricted stock have vested, using the treasury stock method. The treasury stock method assumes proceeds from the exercise price of stock options and the unamortized compensation expense of options and restricted stock are available to acquire shares at an average market price throughout the period, and therefore, reduce the dilutive effect. For the years ended December 31, 2019, 2018, and 2017, there were 1.9 million, 2.6 million, and 2.8 million, respectively, of shares excluded from the diluted earnings/(loss) per share calculation under the treasury stock method, primarily due to outstanding options to purchase shares of Western Union stock, as their exercise prices were above the Company’s weighted-average share price during the periods and their effect was anti-dilutive. Due to the net loss for the year ended December 31, 2017, an additional 3.0 million shares have been excluded from diluted weighted-average shares outstanding, because the effect of including such shares would be anti-dilutive in the calculation of diluted loss per share. The following table provides the calculation of diluted weighted-average shares outstanding (in millions): Year Ended December 31, 2019 2018 2017 Basic weighted-average shares outstanding 427.6 451.8 467.9 Common stock equivalents 3.3 2.6 — Diluted weighted-average shares outstanding 430.9 454.4 467.9 Fair Value Measurements The Company determines the fair values of its assets and liabilities that are recognized or disclosed at fair value in accordance with the hierarchy described below. The fair values of the assets and liabilities held in the Company’s defined benefit plan trust (“Trust”) are recognized or disclosed utilizing the same hierarchy. The following three levels of inputs may be used to measure fair value: ● Level 1 - Quoted prices in active markets for identical assets or liabilities. ● Level 2 - Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For most of these assets, the Company utilizes pricing services that use multiple prices as inputs to determine daily market values. ● Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include items where the determination of fair value requires significant management judgment or estimation. The Company holds assets classified as Level 3 that are recognized and disclosed at fair value on a non-recurring basis related to the Company’s business combinations, where the values of the intangible assets and goodwill acquired in a purchase are derived utilizing one of the three recognized approaches: the market approach, the income approach, or the cost approach. In addition, the Trust has other investments that are valued at net asset value, which are not quoted on an active market; however, the unit price is based on underlying investments which are traded on an active market. Carrying amounts for many of the Company’s financial instruments, including cash and cash equivalents, settlement cash and cash equivalents, and settlement receivables and settlement obligations approximate fair value due to their short maturities. Available-for-sale investment securities and derivative financial instruments are carried at fair value and further discussed in Note 9. Fixed-rate notes are carried at their original issuance values and adjusted over time to accrete that value to par, except for portions of notes hedged by interest rate swap agreements as disclosed in Note 15. The fair values of fixed-rate notes are disclosed in Note 9 and are based on market quotations. The fair values of non-financial assets and liabilities related to the Company’s business combinations are disclosed in Note 5. The fair value of the assets in the Trust, which holds the assets for the Company’s defined benefit pension plan, is disclosed in Note 12. Business Combinations The Company accounts for all business combinations where control over another entity is obtained using the acquisition method of accounting, which requires that most assets (both tangible and intangible), liabilities (including contingent consideration), and remaining noncontrolling interests be recognized at fair value at the date of acquisition. The excess of the purchase price over the fair value of assets less liabilities and noncontrolling interests is recognized as goodwill. Certain adjustments to the assessed fair values of the assets, liabilities, or noncontrolling interests made subsequent to the acquisition date, but within the measurement period, which is one year or less, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded within Net income. Any cost or equity method interest that the Company holds in the acquired company prior to the acquisition is remeasured to fair value at acquisition with a resulting gain or loss recognized within Other income, net for the difference between fair value and existing book value. Results of operations of the acquired company are included in the Company’s results from the date of the acquisition forward and include amortization expense arising from acquired intangible assets. The Company expenses all costs as incurred related to or involved with an acquisition in Selling, general, and administrative expenses. Cash and Cash Equivalents Highly liquid investments (other than those included in settlement assets) with maturities of three months or less at the date of purchase (that are readily convertible to cash) are considered to be cash equivalents and are stated at cost, which approximates fair value. The Company maintains cash and cash equivalent balances, including a portion in money market funds, with a group of globally diversified banks and financial institutions. The Company limits the concentration of its cash and cash equivalents with any one institution and regularly reviews investment concentrations and credit worthiness of these institutions. Allowance for Doubtful Accounts The Company records an allowance for doubtful accounts when it is probable that the related receivable balance will not be collected based on its history of collection experience, known collection issues, such as agent suspensions and bankruptcies, consumer chargebacks and insufficient funds, and other matters the Company identifies in its routine collection monitoring. The allowance for doubtful accounts was $42.2 million and $47.7 million as of December 31, 2019 and 2018, respectively, and is recorded in the same balance sheet captions as the related receivable. During the years ended December 31, 2019, 2018, and 2017, the provision for doubtful accounts (bad debt expense) reflected in the Consolidated Statements of Income/(Loss) was $47.1 million, $43.9 million, and $60.6 million, respectively. Settlement Assets and Obligations Settlement assets represent funds received or to be received from agents for unsettled money transfers, money orders, and consumer payments. The Company records corresponding settlement obligations relating to amounts payable under money transfers, money orders, and consumer payment service arrangements. Settlement assets and obligations also include amounts receivable from, and payable to, customers for the value of their cross-currency payment transactions related to the Business Solutions segment. Settlement assets consist of cash and cash equivalents, receivables from selling agents and Business Solutions customers, and investment securities. Cash received by Western Union agents generally becomes available to the Company within one week after initial receipt by the agent. Cash equivalents consist of short-term time deposits, commercial paper, and other highly liquid investments. Receivables from selling agents represent funds collected by such agents, but in transit to the Company. Western Union has a large and diverse agent base, thereby reducing the credit risk of the Company from any one agent. In addition, the Company performs ongoing credit evaluations of its agents’ financial condition and credit worthiness. See Note 8 for information concerning the Company’s investment securities. Receivables from Business Solutions customers arise from cross-currency payment transactions in the Business Solutions segment. Receivables occur when funds have been paid out to a beneficiary but not yet received from the customer. Aside from these receivables, the credit risk associated with spot foreign currency exchange contracts is largely mitigated, as in most cases the Company requires the receipt of funds from customers before releasing the associated cross-currency payment. Settlement obligations consist of money transfer, money order and payment service payables, and payables to agents. Money transfer payables represent amounts to be paid to transferees when they request their funds. Most agents typically settle with transferees first and then obtain reimbursement from the Company. Money order payables represent amounts not yet presented for payment. Payment service payables represent amounts to be paid to utility companies, auto finance companies, mortgage servicers, financial service providers, government agencies, and others. Due to the agent funding and settlement process, payables to agents represent amounts due to agents for money transfers that have been settled with transferees. Settlement assets and obligations consisted of the following (in millions): December 31, 2019 2018 Settlement assets: Cash and cash equivalents $ 368.2 $ 1,247.8 Receivables from selling agents and Business Solutions customers 1,230.1 1,355.4 Investment securities 1,698.4 1,210.6 Total settlement assets $ 3,296.7 $ 3,813.8 Settlement obligations: Money transfer, money order, and payment service payables $ 2,571.5 $ 2,793.6 Payables to agents 725.2 1,020.2 Total settlement obligations $ 3,296.7 $ 3,813.8 Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the lesser of the estimated life of the related assets (generally three furniture fixtures Property and equipment consisted of the following (in millions): December 31, 2019 2018 Equipment $ 591.4 $ 656.8 Leasehold improvements 159.2 158.6 Buildings 0.4 88.6 Furniture and fixtures 49.4 51.6 Land and improvements — 17.0 Projects in process 3.0 0.2 Total property and equipment, gross 803.4 972.8 Less accumulated depreciation (616.5) (702.4) Property and equipment, net (a) $ 186.9 $ 270.4 (a) At December 31, 2019, Property and equipment, net, excludes assets held for sale of $49.3 million, which primarily consists of the Company’s former headquarters, which was sold in January 2020, and land. These assets are included in Other assets in the Company’s Consolidated Balance Sheets. Amounts charged to expense for depreciation of property and equipment were $79.6 million, $76.9 million, and $77.1 million during the years ended December 31, 2019, 2018, and 2017, respectively. Goodwill Goodwill represents the excess of purchase price over the fair value of tangible and other intangible assets acquired, less liabilities assumed arising from business combinations. In the event a reporting unit’s carrying amount exceeds its fair value, the Company recognizes an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. The Company’s annual impairment assessment did not identify any goodwill impairment during the years ended December 31, 2019 and 2018. For the year ended December 31, 2017, the Company recognized a goodwill impairment charge of $464.0 million related to its Business Solutions reporting unit, as disclosed in Note 5. Other Intangible Assets Other intangible assets primarily consist of contract costs (primarily amounts paid to agents in connection with establishing and renewing long-term contracts), acquired contracts, and software. Other intangible assets are amortized on a straight-line basis over the length of the contract or benefit periods. Included in the Consolidated Statements of Income/(Loss) is amortization expense of $178.1 million, $187.8 million, and $185.8 million for the years ended December 31, 2019, 2018, and 2017, respectively. The Company capitalizes initial payments for new and renewed agent contracts to the extent recoverable through future operations or penalties in the case of early termination. The Company’s accounting policy is to limit the amount of capitalized costs for a given contract to the lesser of the estimated future cash flows from the contract or the termination fees the Company would receive in the event of early termination of the contract. Acquired contracts include customer and contractual relationships and networks of subagents that are recognized in connection with the Company’s acquisitions. The Company purchases and develops software that is used in providing services and in performing administrative functions. Internal and external software development costs incurred that are directly related to the chosen design, development, and testing phases of the software are capitalized once the Company has completed all planning and analysis activities. Any other software development related costs are expensed as incurred. Capitalization of costs ceases when the product is available for general use. Software development costs and purchased software are generally amortized over a term of three The following table provides the components of other intangible assets (in millions): December 31, 2019 December 31, 2018 Weighted- Average Amortization Net of Net of Period Accumulated Accumulated (in years) Initial Cost Amortization Initial Cost Amortization Acquired contracts 11.5 $ 584.2 $ 124.1 $ 598.1 $ 171.2 Capitalized contract costs 6.2 510.3 271.7 536.5 318.9 Internal use software 3.8 281.2 54.7 447.3 80.6 Acquired trademarks 25.4 30.1 13.2 32.5 15.5 Other intangibles 4.3 19.4 — 19.4 — Projects in process (a) 31.2 31.2 12.0 12.0 Total other intangible assets 8.1 $ 1,456.4 $ 494.9 $ 1,645.8 $ 598.2 (a) Not applicable as the assets have not been placed in service. The estimated future aggregate amortization expense for existing other intangible assets as of December 31, 2019 is expected to be $146.6 million in 2020, $113.9 million in 2021, $75.9 million in 2022, $55.9 million in 2023, $38.6 million in 2024, and $32.8 million thereafter. Other intangible assets are reviewed for impairment on an annual basis or whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. In such reviews, estimated undiscounted cash flows associated with these assets or operations are compared with their carrying values to determine if a write-down to fair value (normally measured by the present value technique) is required. The Company recorded immaterial impairments related to other intangible assets during the years ended December 31, 2019, 2018, and 2017. Revenue Recognition For the Company’s accounting policies with respect to revenue recognition, refer to Note 3. Cost of Services Cost of services primarily consists of agent commissions and expenses for call centers, settlement operations, and related information technology costs. Expenses within these functions include personnel, software, equipment, telecommunications, bank fees, depreciation, amortization, and other expenses incurred in connection with providing money transfer and other payment services. Advertising Costs Advertising costs are charged to operating expenses as incurred. Advertising costs for the years ended December 31, 2019, 2018, and 2017 were $209.1 million, $180.9 million, and $168.3 million, respectively. Income Taxes The Company accounts for income taxes under the liability method, which requires that deferred tax assets and liabilities be determined based on the expected future income tax consequences of events that have been recognized in the consolidated financial statements. Deferred tax assets and liabilities are recognized based on temporary differences between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. The Company assesses the realizability of its deferred tax assets. A valuation allowance must be established when, based upon available evidence, it is more likely than not that all or a portion of the deferred tax assets will not be realized. The Company recognizes the tax benefits from uncertain tax positions only when it is more likely than not, based on the technical merits of the position, the tax position will be sustained upon examination, including the resolution of any related appeals or litigation. The tax benefits recognized in the consolidated financial statements from such a position are measured as the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. The Company accounts for the tax effects of global intangible low-taxed income as a component of income tax expense in the period the tax arises. Foreign Currency Translation The United States dollar is the functional currency for substantially all of the Company’s businesses. Revenues and expenses are translated at average exchange rates prevailing during the period. Foreign currency denominated assets and liabilities for those businesses for which the local currency is the functional currency are translated into United States dollars based on exchange rates at the end of the year. The effects of foreign exchange gains and losses arising from the translation of assets and liabilities of these businesses are included as a component of Accumulated other comprehensive loss (“AOCL”) in the accompanying Consolidated Balance Sheets. Foreign currency denominated monetary assets and liabilities of businesses for which the United States dollar is the functional currency are remeasured based on exchange rates at the end of the period, and the resulting remeasurement gains and losses are recognized in Net income/(loss). Non-monetary assets and liabilities of these operations are remeasured at historical rates in effect when the asset was recognized or the liability was incurred. Derivatives The Company uses derivatives to (i) minimize its exposures related to changes in foreign currency exchange rates and interest rates and (ii) facilitate cross-currency Business Solutions payments by writing derivatives to customers. The Company recognizes all derivatives in the Other assets and Other liabilities captions in the accompanying Consolidated Balance Sheets at their fair value. All cash flows associated with derivatives are included in Cash flows from operating activities in the Consolidated Statements of Cash Flows. Certain of the Company’s derivative arrangements are designated as either cash flow hedges or fair value hedges at the time of inception, and others are not designated as accounting hedges. ● Cash flow hedges – Cash flow hedges consist of foreign currency hedging of forecasted revenues, as well as hedges of the forecasted issuance of fixed-rate debt. Derivative fair value changes that are captured in AOCL are reclassified to earnings in the same period the hedged item affects earnings when the instrument is effective in offsetting the change in cash flows attributable to the risk being hedged. On January 1, 2018, the Company early adopted an accounting pronouncement related to hedging activities. As a result of the new accounting pronouncement, for foreign currency cash flow hedges entered into on or after January 1, 2018, the Company excludes time value from the assessment of effectiveness, and the initial value of the excluded components is amortized into Revenues within the Consolidated Statements of Income/(Loss). For foreign currency cash flow hedges entered into before January 1, 2018, all changes in the fair value of the excluded components are recognized immediately in Revenues for the years ended December 31, 2019 and 2018. For the year ended December 31, 2017, the changes in fair value of the excluded components were recognized immediately within the Consolidated Statements of Income/(Loss) and are included in Other income, net. ● Fair value hedges - Fair value hedges consist of hedges of fixed-rate debt, through interest rate swaps. Changes in the fair value of derivatives that are designated as fair value hedges of fixed-rate debt are recorded in Interest expense. The offsetting change in value of the related debt instrument attributable to changes in the benchmark interest rate is also recorded in Interest expense. At December 31, 2019, there were no fair value hedges outstanding. ● Undesignated - Derivative contracts entered into to reduce the foreign exchange variability related to (i) money transfer settlement assets and obligations, generally with maturities from a few days up to one month , and (ii) certain foreign currency denominated cash and other asset and liability positions, typically with maturities of less than one year at inception, are not designated as hedges for accounting purposes and changes in their fair value are included in Selling, general, and administrative. The Company is also exposed to risk from derivative contracts written to its customers arising from its cross-currency Business Solutions payments operations. The duration of these derivative contracts at inception is generally less than one year . The Company aggregates its Business Solutions payments foreign currency exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties (economic hedge contracts) as part of a broader foreign currency portfolio, including significant spot exchanges of currency in addition to forwards and options. The changes in fair value related to these contracts are recorded in Revenues. The fair value of the Company’s derivatives is derived from standardized models that use market-based inputs (e.g., forward prices for foreign currency). The details of each designated hedging relationship are formally documented at the inception of the arrangement, including the risk management objective, hedging strategy, hedged item, specific risks being hedged, the derivative instrument, and how effectiveness is being assessed. The derivative must be highly effective in offsetting the changes in cash flows or fair value of the hedged item, and effectiveness is evaluated quarterly on a retrospective and prospective basis. Legal Contingencies The Company is a party to certain legal and regulatory proceedings with respect to a variety of matters. The Company records an accrual for these contingencies to the extent that a loss is both probable and reasonably estimable. If some amount within a range of loss appears to be a better estimate than other amounts within the range, that amount is accrued. When no amount within a range of loss appears to be a better estimate than any other amount, the lowest amount in the range is accrued. Stock-Based Compensation The Company currently has a stock-based compensation plan that provides for grants of Western Union stock options, restricted stock awards, and restricted and unrestricted stock units to employees and non-employee directors of the Company. All stock-based compensation to employees is required to be measured at fair value and expensed over the requisite service period. The Company recognizes compensation expense on awards on a straight-line basis over the requisite service period for the entire award, with an estimate for forfeitures. Refer to Note 17 for additional discussion regarding details of the Company’s stock-based compensation plans. Severance and Other Related Expenses The Company records severance-related expenses once they are both probable and estimable in accordance with the provisions of the applicable accounting guidance for severance provided under an ongoing benefit arrangement. One-time involuntary benefit arrangements and other costs are generally recognized when the liability is incurred. The Company also evaluates impairment issues associated with restructuring and other activities when the carrying amount of the related assets may not be fully recoverable, in accordance with the appropriate accounting guidance. Recently Adopted Accounting Pronouncements On January 1, 2019, the Company adopted a new accounting standard, as amended, that requires the Company to record assets and liabilities on the balance sheet for lease-related rights and obligations and disclose key information about its leasing arrangements. The Company elected the effective date method, utilized the modified retrospective On January 1, 2018, the Company adopted a new accounting standard, as amended, regarding revenue from contracts with customers using the modified retrospective approach. This standard provides guidance on recognizing revenue, including a five-step model to determine when revenue recognition is appropriate. The adoption of this standard did not have a material impact on the Company’s financial position and results of operations. Refer to Note 3 for the related additional disclosures. On January 1, 2018, the Company retrospectively adopted an accounting pronouncement that requires restricted cash, which is recorded in Other assets in the Company’s Consolidated Balance Sheets, to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period amounts shown on the statements of cash flows. The adoption of this standard had an immaterial impact on the Company’s historical operating cash flows within the Consolidated Statements of Cash Flows. In the first quarter of 2018, the Company adopted a new accounting pronouncement that provides entities the option to reclassify tax effects included within AOCL as a result of the United States tax reform legislation enacted in December 2017 (the “Tax Act”) to retained earnings. The adoption of this standard resulted in an increase to AOCL and a decrease to Accumulated deficit in the Consolidated Balance Sheets of $31.4 million, which represents the tax effects of the lower federal tax rate on unrealized gains/(losses) on investment securities, hedging activities, and adjustments related to the Company’s defined benefit pension plan, in addition to the release of deferred taxes accrued on undistributed earnings of one of the Company’s subsidiaries that are no longer owed under the Tax Act. The Company will continue to release tax effects remaining in AOCL into income as the individual units of account are sold or otherwise extinguished. Refer to Note 14 for additional information. Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board issued a new accounting pronouncement regarding credit losses for financial instruments. The new standard requires entities to measure expected credit losses for certain financial assets held at the reporting date using a current expected credit loss model, which is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. Additionally, the standard requires certain credit losses relating to investment securities classified as available-for-sale to be recorded through an allowance for credit losses. The Company is required to adopt the new standard on January 1, 2020. The Company has completed its analysis of the standard and has concluded that the adoption of the standard will not have a material impact on the Company’s financial statements. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue | |
Revenue | 3. Revenue On January 1, 2018, the Company adopted a new accounting standard, as amended, regarding revenue from contracts with customers using the modified retrospective approach, which was applied to all contracts with customers. The standard requires that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company recognized the cumulative effect of initially applying the new revenue standard as an adjustment to the opening balance of Accumulated deficit in the Consolidated Balance Sheet, and the adoption of the new accounting standard did not have a material impact on the Company’s January 1, 2018 accumulated deficit. In accordance with the modified retrospective approach, the comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The adoption of the new revenue standard did not have a material impact to the Company’s revenues or net income on an ongoing basis. The Company’s revenues are primarily derived from consideration paid by customers to transfer money. These revenues vary by transaction based upon factors such as channel, send and receive locations, the principal amount sent, whether the money transfer involves different send and receive currencies, the difference between the exchange rate set by the Company to the customer and the rate available in the wholesale foreign exchange market, and speed of service, as applicable. The Company also offers several other services, including foreign exchange and payment services and other bill payment services, for which revenue is impacted by similar factors. For the substantial majority of the Company’s revenues, the Company acts as the principal in transactions and reports revenue on a gross basis, as the Company controls the service at all times prior to transfer to the customer, is primarily responsible for fulfilling the customer contracts, has the risk of loss, and has the ability to establish transaction prices. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company recognized $5,033.2 million and $5,382.6 million in revenues from contracts with customers for the years ended December 31, 2019 and 2018, respectively. There are no material upfront costs incurred to obtain contracts with customers. Under the Company’s loyalty programs, which are primarily offered in its money transfer services, the Company must fulfill loyalty program rewards earned by customers. The loyalty program redemption activity has been and continues to be insignificant to the Company’s results of operations, and the Company has immaterial contract liability balances, which primarily relate to its customer loyalty programs and other services. Contract asset balances related to customers were also immaterial as of December 31, 2019 and 2018, as the Company typically receives payment of consideration from its customers prior to satisfying performance obligations under the customer contracts. In addition to revenue generated from contracts with customers, the Company recognizes revenue from other sources, including the sale of derivative financial instruments and investment income generated on settlement assets primarily related to money transfer and money order services. The Company analyzes its different services individually to determine the appropriate basis for revenue recognition, as further described below. Revenues from consumer money transfers are included in the Company’s Consumer-to-Consumer segment, revenues from foreign exchange and payment services are included in the Company’s Business Solutions segment, and revenues from consumer bill payments and other services are not included in the Company’s segments and are reported as Other. See Note 18 for further information on the Company’s segments. Consumer Money Transfers For the Company’s money transfer services, customers agree to the Company’s terms and conditions at the time of initiating a transaction. In a money transfer, the Company has one performance obligation as the customer engages the Company to perform one integrated service which typically occurs within minutes — collect the customer’s money and make funds available for payment to a designated person in the currency requested. Therefore, the Company recognizes revenue upon completion of the following: (i) the customer’s acknowledgment of the Company’s terms and conditions and payment information has been received by the Company, (ii) the Company has agreed to process the money transfer, (iii) the Company has provided the customer a unique transaction identification number, and (iv) funds are available to be picked up by the customer’s designated receiving party. The transaction price is comprised of a transaction fee and the difference between the exchange rate set by the Company to the customer and the rate available in the wholesale foreign exchange market, as applicable, both of which are readily determinable at the time the transaction is initiated. Foreign Exchange and Payment Services For the Company’s foreign exchange and payment services, customers agree to terms and conditions for all transactions, either at the time of initiating a transaction or signing a contract with the Company to provide payment services on the customer’s behalf. In the majority of the Company’s foreign exchange and payment services, the Company makes payments to the recipient to satisfy its performance obligation to the customer, and therefore, the Company recognizes revenue on foreign exchange and payment services when this performance obligation has been fulfilled. Revenues from foreign exchange and payment services are primarily comprised of the difference between the exchange rate set by the Company to the customer and the rate available in the wholesale foreign exchange market. Consumer Bill Payments The Company offers several different bill payment services that vary by considerations such as: (i) who pays the fee to the Company (consumer or biller), (ii) whether the service is offered to all potential consumers, or only to those for which the Company has a relationship with the biller, and (iii) whether the service utilizes a physical agent network offered for consumers’ convenience, among other factors. The determination of which party is the Company’s customer for revenue recognition purposes is based on these considerations for each of the Company’s bill payment services. For all transactions, the Company’s customers agree to the Company’s terms and conditions, either at the time of initiating a transaction (where the consumer is determined to be the customer for revenue recognition purposes) or upon signing a contract with the Company to provide services on the biller’s behalf (where the biller is determined to be the customer for revenue recognition purposes). As with consumer money transfers, customers engage the Company to perform one integrated service — collect money from the consumer and process the bill payment transaction, thereby providing the billers real-time or near real-time information regarding their customers’ payments and simplifying the billers’ collection efforts. The significant majority of the Company’s revenues from bill payment services are generated from contracts to process transactions at any time during the duration of the contract. In May 2019, the Company sold a substantial majority of its United States based electronic bill payments services, as discussed in Note 5. Management has determined that the significant majority of the Company’s revenue is recognized at a point in time. The following tables represent the disaggregation of revenue earned from contracts with customers by product type and region for the years ended December 31, 2019 and 2018 (in millions). The regional split of revenue shown in the tables below is based upon where transactions are initiated. Revenues that would have been reported under previous accounting guidance would not have been materially different from the amounts shown below: Year Ended December 31, 2019 Foreign Consumer Exchange Money and Payment Consumer Other Transfers Services Bill Payments (c) Services Total Regions: North America $ 1,653.5 $ 95.4 $ 223.0 $ 55.9 $ 2,027.8 Europe and Russia/CIS 1,350.1 127.1 3.2 4.1 1,484.5 Middle East, Africa, and South Asia 642.0 1.8 0.4 — 644.2 Latin America and the Caribbean 395.2 3.4 129.4 15.3 543.3 East Asia and Oceania 263.5 68.4 1.5 — 333.4 Revenues from contracts with customers $ 4,304.3 $ 296.1 $ 357.5 $ 75.3 $ 5,033.2 Other revenues (a) 103.5 92.7 37.3 25.4 258.9 Total revenues (b) $ 4,407.8 $ 388.8 $ 394.8 $ 100.7 $ 5,292.1 Year Ended December 31, 2018 Foreign Consumer Exchange Money and Payment Consumer Other Transfers Services Bill Payments (c) Services Total Regions: North America $ 1,632.3 $ 97.6 $ 463.9 $ 57.4 $ 2,251.2 Europe and Russia/CIS 1,399.5 130.0 3.1 3.9 1,536.5 Middle East, Africa, and South Asia 654.4 1.5 0.3 — 656.2 Latin America and the Caribbean 393.2 3.1 152.7 13.7 562.7 East Asia and Oceania 304.6 69.9 1.5 — 376.0 Revenues from contracts with customers $ 4,384.0 $ 302.1 $ 621.5 $ 75.0 $ 5,382.6 Other revenues (a) 69.6 84.7 30.8 22.2 207.3 Total revenues (b) $ 4,453.6 $ 386.8 $ 652.3 $ 97.2 $ 5,589.9 (a) Includes revenue from the sale of derivative financial instruments, investment income generated on settlement assets primarily related to money transfer and money order services, and other sources. (b) Revenues from “Consumer money transfers” are included in the Company’s Consumer-to-Consumer segment, revenues from “Foreign exchange and payment services” are included in the Company’s Business Solutions segment, and revenues from “Consumer bill payments” and “Other services” are not included in the Company’s segments and are reported as Other. See Note 18 for further information on the Company’s segments . (c) On February 28, 2019, the Company entered into an agreement with ACI Worldwide Corp. and ACW Worldwide, Inc. to sell its United States electronic bill payments business known as “Speedpay,” and closed the transaction on May 9, 2019. Included within North America revenues are Speedpay revenues of $125.4 million and $352.0 million for the years ended December 31, 2019 and 2018, respectively. |
Restructuring-Related Expenses
Restructuring-Related Expenses and Business Transformation Expenses | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring-Related Expenses and Business Transformation Expenses | |
Restructuring-Related Expenses and Business Transformation Expenses | 4. Restructuring-Related Expenses and Business Transformation Expenses Restructuring-Related Expenses On August 1, 2019, the Company’s Board of Directors approved a plan to change the Company’s operating model and improve its business processes and cost structure by reorganizing the Company’s senior management, including those managers reporting to the Chief Executive Officer (“CEO”), reducing its headcount, and consolidating various facilities. The Company expects to incur approximately $150 million of total expenses through 2020, with approximately $110 million related to severance and employee-related benefits and approximately $40 million related to costs associated with the relocation of various operations to other Company facilities, costs related to facility closures, lease terminations, consulting, and other expenses. Substantially all of these expenses are expected to be paid in cash. The foregoing figures are the Company’s estimates and are subject to change as the plan is anticipated to be completed by the end of 2020. While certain of the expenses may be identifiable to the Company’s segments, primarily to the Company’s Consumer-to-Consumer segment, the expenses are not included in the measurement of segment operating income provided to the Chief Operating Decision Maker (“CODM”) for purposes of performance assessment and resource allocation. These expenses are therefore excluded from the Company’s segment operating income results. These expenses are specific to this initiative; however, the types of expenses related to this initiative are similar to expenses that the Company has previously incurred and can reasonably be expected to incur in the future. The following table summarizes the activity for the year ended December 31, 2019 for expenses related to the restructuring accruals, which are included in Accounts payable and accrued liabilities in the Company’s Consolidated Balance Sheets as of December 31, 2019 (in millions): Severance and Facility Relocations Related and Closures, Employee Consulting, Benefits and Other Total Balance, December 31, 2018 $ — $ — $ — Expenses (a) 98.0 17.5 115.5 Cash payments (28.6) (9.6) (38.2) Non-cash benefits/(charges) (a) 1.8 (5.8) (4.0) Balance, December 31, 2019 $ 71.2 $ 2.1 $ 73.3 (a) Non-cash benefits/(charges) include non-cash write-offs and accelerated depreciation of ROU assets and leasehold improvements and a non-cash benefit for adjustments to stock compensation for awards forfeited by employees. These amounts have been removed from the liability balance in the table above as they do not impact the restructuring accruals. The following table presents restructuring-related expenses as reflected in the Consolidated Statements of Income/(Loss) (in millions): Year Ended December 31, 2019 Cost of services $ 39.8 Selling, general, and administrative 75.7 Total expenses, pre-tax $ 115.5 Total expenses, net of tax $ 90.0 Business Transformation Expenses In the second quarter of 2016, the Company began incurring expenses related to a business transformation initiative (“WU Way”). As of December 31, 2017, expenses associated with the WU Way initiative were effectively complete. Although the expenses related to the WU Way are specific to that initiative, the types of expenses related to the WU Way initiative are similar to expenses that the Company has previously incurred and can reasonably be expected to incur in the future. The cash payments related to the WU Way for the years ended December 31, 2018 and 2017 were $32.3 million and $77.3 million, respectively. The business transformation liability was not material as of December 31, 2018. The following table presents expenses related to business transformation initiatives as reflected in the Consolidated Statements of Income/(Loss) (in millions): Year Ended December 31, 2017 Cost of services $ 35.7 Selling, general, and administrative 58.7 Total expenses, pre-tax $ 94.4 Total expenses, net of tax $ 63.3 While certain of the business transformation expenses were identifiable to the Company’s segments, primarily to the Company’s Consumer-to-Consumer segment, the expenses were not included in the measurement of segment operating income provided to the CODM for purposes of performance assessment and resource allocation. These expenses were therefore excluded from the Company’s segment operating income results. |
Divestitures, Business Combinat
Divestitures, Business Combinations, and Goodwill | 12 Months Ended |
Dec. 31, 2019 | |
Divestitures, Business Combinations, and Goodwill | |
Divestitures, Business Combinations, and Goodwill | 5. Divestitures, Business Combinations, and Goodwill Divestitures of Businesses On February 28, 2019, the Company entered into an agreement with ACI Worldwide Corp. and ACW Worldwide, Inc. (together, “ACI”) to sell its United States electronic bill payments business known as Speedpay, which had been included as a component of Other in the Company’s segment reporting. The Company received approximately $750 million and recorded a pre-tax gain on the sale of approximately $523 million, which is included in Gain on divestitures of businesses in the accompanying Consolidated Statements of Income/(Loss), in the all-cash transaction that closed on May 9, 2019. Speedpay revenues included in the Company’s results were $125.4 million, $352.0 million, and $368.3 million for the years ended December 31, 2019, 2018, and 2017, respectively. Speedpay direct operating expenses were $98.2 million, $251.2 million, and $246.0 million for the years ended December 31, 2019, 2018, and 2017, respectively. On May 6, 2019, the Company completed the sale of Paymap Inc. (“Paymap”), which provides electronic mortgage bill payment services, for contingent consideration and immaterial cash proceeds received at closing. The Company recorded an immaterial pre-tax gain related to this sale during 2019. Business Solutions Goodwill Impairment Charge During the year ended December 31, 2017, the Company recognized a goodwill impairment charge of $464.0 million related to its Business Solutions reporting unit, as the estimated fair value of the reporting unit declined below its carrying value. The reduction in estimated fair value primarily resulted from a decrease in projected revenue growth rates and Earnings before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) margins and the impact of the Tax Act. Revenue and EBITDA projections were reevaluated during the year ended December 31, 2017 due to the declines in revenues and operating results recognized in the fourth quarter of 2017, which were significantly below management’s expectations. Additionally, as disclosed in prior Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, the total estimated fair value of the Business Solutions reporting unit previously included value derived from strategies to optimize United States cash flow management and global liquidity by utilizing international cash balances (including balances generated by other operating segments) to initially fund global principal payouts for Business Solutions transactions initiated in the United States (“Cash Management Strategies”) that would have been available to certain market participants. However, the Tax Act, which imposed a tax on certain previously undistributed foreign earnings and established minimum taxes on certain future payments and foreign earnings, eliminated any fair value associated with the Cash Management Strategies. The Company estimated the fair value of its Business Solutions reporting unit using the income approach. The estimated fair value was derived primarily using unobservable Level 3 inputs, including projections of revenue growth rates and EBITDA margins, which require significant management judgment and estimation. The Company did not record any goodwill impairments during the years ended December 31, 2019 and 2018. Business Combinations On November 6, 2017, the Company completed the purchase of Opus Software Technologies Private Limited and the assets of its affiliate for total consideration of approximately $25.3 million. The Company believes that the acquisition has assisted and will continue to assist in enhancing and centralizing the Company’s information technology expertise through a newly established information technology development and maintenance center located in India, which was an integral part of the Company’s WU Way transformation efforts. The acquisition does not and will not impact the Company’s revenues. During the first quarter of 2018, the Company finalized the valuation of the acquisition, for which it has recognized approximately $22.0 million of goodwill. The valuation of the acquisition was derived primarily using unobservable Level 3 inputs, which require significant management judgment and estimation. The following table presents changes to goodwill for the years ended December 31, 2019 and 2018 (in millions): Consumer-to- Business Consumer Solutions Other Total January 1, 2018 goodwill, net $ 1,981.0 $ 532.0 $ 214.9 $ 2,727.9 Purchase accounting adjustments (0.3) — — (0.3) Currency translation — — (2.6) (2.6) December 31, 2018 goodwill, net $ 1,980.7 $ 532.0 $ 212.3 $ 2,725.0 Divestitures (a) — — (158.4) (158.4) December 31, 2019 goodwill, net $ 1,980.7 $ 532.0 $ 53.9 $ 2,566.6 (a) Related to the Speedpay and Paymap divestitures, as described above. The following table presents accumulated impairment losses as of December 31, 2019, 2018, and 2017 (in millions): As of December 31, 2019 2018 2017 Goodwill, gross $ 3,030.6 $ 3,189.0 $ 3,191.9 Accumulated impairment losses (464.0) (464.0) (464.0) Goodwill, net $ 2,566.6 $ 2,725.0 $ 2,727.9 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Commitments and Contingencies | 6. Commitments and Contingencies Letters of Credit and Bank Guarantees The Company had approximately $335 million in outstanding letters of credit and bank guarantees as of December 31, 2019 that are primarily held in connection with safeguarding consumer funds, lease arrangements, and certain agent agreements. The letters of credit and bank guarantees have expiration dates through 2024, with many having a one-year renewal option. The Company expects to renew the letters of credit and bank guarantees prior to expiration in most circumstances. These letters of credit and bank guarantees exclude guarantees that the Company may provide as part of its legal matters, as described below. Litigation and Related Contingencies The Company is subject to certain claims and litigation that could result in losses, including damages, fines and/or civil penalties, which could be significant, and in some cases, criminal charges. The Company regularly evaluates the status of legal matters to assess whether a loss is probable and reasonably estimable in determining whether an accrual is appropriate. Furthermore, in determining whether disclosure is appropriate, the Company evaluates each legal matter to assess if there is at least a reasonable possibility that a loss or additional losses may have been incurred and whether an estimate of possible loss or range of loss can be made. Unless otherwise specified below, the Company believes that there is at least a reasonable possibility that a loss or additional loss may have been incurred for each of the matters described below. For those matters that the Company believes there is at least a reasonable possibility that a loss or additional loss may have been incurred and can reasonably estimate the loss or potential loss, the reasonably possible potential litigation losses in excess of the Company’s recorded liability for probable and estimable losses was approximately $30 million as of December 31, 2019. For the remaining matters, management is unable to provide a meaningful estimate of the possible loss or range of loss because, among other reasons: (i) the proceedings are in preliminary stages; (ii) specific damages have not been sought; (iii) damage claims are unsupported and/or unreasonable; (iv) there is uncertainty as to the outcome of pending appeals or motions; (v) there are significant factual issues to be resolved; or (vi) novel legal issues or unsettled legal theories are being asserted. The outcomes of legal actions are unpredictable and subject to significant uncertainties, and it is inherently difficult to determine whether any loss is probable or even possible. It is also inherently difficult to estimate the amount of any loss and there may be matters for which a loss is probable or reasonably possible but not currently estimable. Accordingly, actual losses may be in excess of the established liability or the range of reasonably possible loss. United States Department of Justice, Federal Trade Commission, Financial Crimes Enforcement Network, and State Attorneys General Settlements In late November 2016, the Company entered into discussions with the United States Department of Justice (the “DOJ”), the United States Attorney’s Office for the Central District of California (“USAO-CDCA”), the United States Attorney’s Office for the Eastern District of Pennsylvania (“USAO-EDPA”), the United States Attorney’s Office for the Middle District of Pennsylvania (“USAO-MDPA”), and the United States Attorney’s Office for the Southern District of Florida (“USAO-SDFL”) to resolve the investigations by the USAO-CDCA, USAO-EDPA, USAO-MDPA, and USAO-SDFL (collectively, the “USAOs”). On January 19, 2017, the Company announced that it, or its subsidiary Western Union Financial Services, Inc. (“WUFSI”), had entered into 1) a Deferred Prosecution Agreement (the “DPA”) with the DOJ and the USAOs; 2) a Stipulated Order for Permanent Injunction and Final Judgment (the “Consent Order”) with the United States Federal Trade Commission (“FTC”) resolving claims by the FTC alleging unfair acts and practices under the Federal Trade Commission Act and for violations of the FTC Telemarketing Sales Rule; and 3) a Consent to the Assessment of Civil Money Penalty with the Financial Crimes Enforcement Network (“FinCEN”) of the United States Department of Treasury (the “FinCEN Agreement”), to resolve the respective investigations of those agencies. FinCEN provided notice to the Company dated December 16, 2016 of its investigation regarding possible violations of the United States Bank Secrecy Act (“BSA”). On January 31, 2017, the Company entered into assurances of discontinuance/assurances of voluntary compliance with the attorneys general of 49 U.S. states and the District of Columbia named therein to resolve investigations by the state attorneys general, which sought information and documents relating to money transfers sent from the United States to certain countries, consumer fraud complaints that the Company had received and the Company’s procedures to help identify and prevent fraudulent transfers. On April 12, 2017, the Company settled with the one remaining state attorney general under effectively the same terms as the January 31, 2017 agreement with no additional monetary payment required. The agreements with the state attorneys general are collectively referred to herein as the “State AG Agreement.” The DPA, Consent Order, FinCEN Agreement, and State AG Agreement are collectively referred to herein as the “Joint Settlement Agreements.” Pursuant to the DPA, the USAOs filed a two-count criminal information in the United States District Court for the Middle District of Pennsylvania, charging the Company with aiding and abetting wire fraud and willfully failing to implement an effective anti-money laundering (“AML”) program. The USAOs agreed that if the Company fully complies with all of its obligations under the DPA, the USAOs will, at the conclusion of the DPA’s term, seek dismissal with prejudice of the criminal information filed against the Company. The term of the DPA ended on January 19, 2020, and the agreement has expired. Under the DPA, to close out this matter, the DOJ has 90 days from the expiration to file for dismissal of the charges. Under the Joint Settlement Agreements, the Company was required to 1) pay an aggregate amount of $586 million to the DOJ to be used to reimburse consumers who were the victims of third-party fraud conducted through the Company’s money transfer services (the “Compensation Payment”); 2) pay an aggregate amount of $5 million to the State Attorneys General to reimburse investigative, enforcement, and other costs; and 3) retain an independent compliance auditor for three years to review and assess actions taken by the Company under the Consent Order to further enhance its oversight of agents and protection of consumers. The FinCEN Agreement also set forth a civil penalty of $184 million, the full amount of which was deemed satisfied by the Compensation Payment. No separate payment to the FTC was required under the Joint Settlement Agreements. The Company paid the Compensation Payment and the aggregate amount due to the State Attorneys General during 2017. The Joint Settlement Agreements also required, among other things, the Company to adopt certain new or enhanced practices with respect to its compliance program relating to consumer reimbursement, agent due diligence, agent training, monitoring, reporting, and record-keeping by the Company and its agents, consumer fraud disclosures, agent suspensions and terminations, and other items. The ongoing obligations under the Joint Settlement Agreements have had and could continue to have adverse effects on the Company’s business, including additional costs and potential loss of business. The Company has faced (as described below) additional actions from other regulators as a result of the Joint Settlement Agreements. Further, if the Company fails to comply with the Joint Settlement Agreements, it could face criminal prosecution, civil litigation, significant fines, damage awards or other regulatory consequences. Any or all of these outcomes could have a material adverse effect on the Company’s business, financial condition, results of operations, and cash flows. Shareholder Derivative Action On January 16, 2020, Stanley Lieblein filed a shareholder derivative complaint in the Court of Chancery of the State of Delaware naming the Company’s President and Chief Executive Officer, certain current and former directors, and a former executive officer as individual defendants and the Company as a nominal defendant. Mr. Lieblein had previously filed a shareholder derivative action asserting related claims in the United States District Court for the District of Colorado, which was subsequently consolidated with multiple pending related derivative actions. Following the filing of multiple amended complaints, the United States Court of Appeals for the Tenth Circuit affirmed dismissal of the consolidated derivative action on April 16, 2019 on the ground that the plaintiffs did not have standing to proceed on behalf of the Company without making a demand on the Company’s board of directors. The consolidated derivative action is described in further detail in the Company’s prior disclosures. On August 1, 2019, Mr. Lieblein made a written demand on the Company’s board of directors to investigate and address alleged misconduct related to the Company’s anti-fraud and AML compliance programs, including certain alleged misconduct at issue in the consolidated derivative action. The Company’s board of directors formed a special committee to evaluate Mr. Lieblein’s demand together with a related shareholder demand. The special committee’s investigation is ongoing. Mr. Lieblein alleges that he filed the January 16, 2020 complaint prior to the completion of the special committee’s investigation because of concerns regarding the statute of limitations on some of the claims asserted. Mr. Lieblein has agreed to stay the action pending completion of the special committee’s investigation, or until September 30, 2020, whichever occurs earlier. The complaint filed by Mr. Lieblein on January 16, 2020 includes allegations that the director and officer defendants declined to implement effective anti-fraud and AML compliance systems after receiving numerous red flags indicating prolonged willful illegality, condoned executive officers’ obstruction of efforts by various regulators to impose an effective compliance system on the Company, approved executive compensation packages for management that were not aligned with development of effective anti-fraud and AML compliance programs, allowed management to fail to timely report known or likely impropriety by Company employees or agents to regulatory authorities, failed to require management to adopt a risk assessment for all very high risk areas, refused to remedy the board’s oversight of executive officers, and, in effect, refused Mr. Lieblein’s shareholder demand and related request for tolling agreements. It also includes allegations that the officer defendants declined to ensure that the Company implemented effective anti-fraud and AML compliance programs after receiving red flags that those programs were inadequate, allowed Company agents to willfully ignore anti-fraud and AML recording and reporting requirements for a prolonged period, opposed efforts by various regulators to implement effective anti-fraud and AML complaint programs, caused the Company to fail to comply with its obligations under settlements with regulators, and knowingly exposed the Company to criminal and civil sanctions. Due to the nature of this matter and the early stage of the proceedings, the Company cannot predict the outcome or potential impact of the matter. Other Matters On March 12, 2014, Jason Douglas filed a purported class action complaint in the United States District Court for the Northern District of Illinois asserting a claim under the Telephone Consumer Protection Act, 47 U.S.C. § 227, et seq., based on allegations that since 2009, the Company has sent text messages to class members’ wireless telephones without their consent. During the first quarter of 2015, the Company’s insurance carrier and the plaintiff reached an agreement to create an $8.5 million settlement fund that will be used to pay all class member claims, class counsel’s fees and the costs of administering the settlement. The agreement has been signed by the parties and, on November 10, 2015, the Court granted preliminary approval to the settlement. On January 9, 2018, plaintiff filed a motion requesting decisions on its pending motion to approve the settlement and motion for attorneys’ fees, costs, and incentive award. On August 31, 2018, the Court issued an order approving the settlement, in which the Court modified the class definition slightly and ordered the parties to provide additional notice to the class. In 2014, the Company accrued an amount equal to the retention under its insurance policy and believes that any amounts in excess of this accrual will be covered by the insurer. However, if the Company’s insurer is unable to or refuses to satisfy its obligations under the policy or the parties are unable to reach a definitive agreement or otherwise agree on a resolution, the Company’s financial condition, results of operations, and cash flows could be adversely impacted. As the parties have reached an agreement in this matter, the Company believes that the potential for additional loss in excess of amounts already accrued is remote. In October 2015, Consumidores Financieros Asociación Civil para su Defensa, an Argentinian consumer association, filed a purported class action lawsuit in Argentina’s National Commercial Court No. 19 against the Company’s subsidiary Western Union Financial Services Argentina S.R.L. (“WUFSA”). The lawsuit alleges, among other things, that WUFSA’s fees for money transfers sent from Argentina are excessive and that WUFSA does not provide consumers with adequate information about foreign exchange rates. The plaintiff is seeking, among other things, an order requiring WUFSA to reimburse consumers for the fees they paid and the foreign exchange revenue associated with money transfers sent from Argentina, plus punitive damages. The complaint does not specify a monetary value of the claim or a time period. In November 2015, the Court declared the complaint formally admissible as a class action. The notice of claim was served on WUFSA in May 2016, and in June 2016 WUFSA filed a response to the claim and moved to dismiss it on statute of limitations and standing grounds. In April 2017, the Court deferred ruling on the motion until later in the proceedings. The process for notifying potential class members has been completed and the case is currently in the evidentiary stage. Due to the stage of this matter, the Company is unable to predict the outcome or the possible loss or range of loss, if any, associated with this matter. WUFSA intends to defend itself vigorously. On February 22, 2017, the Company, its President and Chief Executive Officer, its Chief Financial Officer, and a former executive officer of the Company were named as defendants in two purported class action lawsuits, both of which asserted claims under section 10(b) of the Exchange Act and Securities and Exchange Commission rule 10b-5 and section 20(a) of the Exchange Act. On May 3, 2017, the two cases were consolidated by the United States District Court for the District of Colorado under the caption Lawrence Henry Smallen and Laura Anne Smallen Revocable Living Trust et al. v. The Western Union Company et al. On February 13, 2017, the Company’s subsidiary, Western Union Payment Services Ireland Limited (“WUPSIL”), was served with a writ of accusation from the National Court of Spain. The writ charges 98 former Western Union money transfer agents or agent representatives with fraud and money laundering in connection with consumer fraud scams they allegedly perpetrated using Western Union money transfer transactions. The writ also names WUPSIL as a civil defendant, allegedly responsible under Spanish law to pay any portion of the alleged amount in victim losses that cannot be repaid by any of the criminal defendants who are convicted. In accordance with Spanish law, on January 4, 2018, the Company, through its subsidiary Western Union International Limited, provided a corporate guaranty in an amount of approximately €23 million to cover any liability that could theoretically attach to WUPSIL. On October 3, 2019, WUPSIL reached a settlement agreement with the Spanish prosecutor that extinguishes WUPSIL’s civil liability for the fraud scams at issue by stating that the liability has already been covered by the Compensation Payment under the DPA. On October 8, 2019, WUPSIL filed a motion requesting release of the corporate guarantee. On November 4, 2019, the Court issued final judgment in this matter consistent with the settlement agreement. WUPSIL filed a new motion requesting release of the corporate guarantee on December 2, 2019, which is still pending before the Court. On March 31, 2017, the Company received a request for the production of documents from the New York State Department of Financial Services (the “NYDFS”), following up on a meeting the Company had with the NYDFS on March 7, 2017. The requests pertain to the Company’s oversight of one current and two former Western Union agents located in New York state. The two former agents were identified in the DPA described in the United States Department of Justice, Federal Trade Commission, Financial Crimes Enforcement Network, and State Attorneys General Settlements section above, and were terminated as agents by the Company prior to 2013. On July 28, 2017, the NYDFS informed the Company that the facts set forth in the DPA regarding the Company’s anti-money laundering programs over the 2004 through 2012 period gave the NYDFS a basis to take additional enforcement action. On January 4, 2018, the Company’s subsidiary, WUFSI, and the NYDFS agreed to a consent order (the “NYDFS Consent Order”), which resolved the NYDFS investigation into these matters. Under the NYDFS Consent Order, the Company was required, among other things, to pay to the NYDFS a civil monetary penalty of $60 million, which the Company paid on January 12, 2018. On April 26, 2018, the Company, its WUFSI subsidiary, its President and Chief Executive Officer, and various “Doe Defendants” (purportedly including Western Union officers, directors, and agents) were named as defendants in a purported class action lawsuit asserting claims for alleged violations of civil Racketeer Influenced and Corrupt Organizations Act and the Colorado Organized Crime Act, civil theft, negligence, unjust enrichment, and conversion under the caption Frazier et al. v. The Western Union Company et al., In addition to the principal matters described above, the Company is a party to a variety of other legal matters that arise in the normal course of the Company’s business. While the results of these other legal matters cannot be predicted with certainty, management believes that the final outcome of these matters will not have a material adverse effect either individually or in the aggregate on the Company’s financial condition, results of operations, or cash flows. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions | |
Related Party Transactions | 7. Related Party Transactions The Company has ownership interests in certain of its agents accounted for under the equity method of accounting. The Company pays these agents commissions for money transfer and other services provided on the Company’s behalf. Commission expense recognized for these agents for the years ended December 31, 2019, 2018, and 2017 totaled $57.1 million, $57.6 million, and $65.9 million, respectively. |
Investment Securities
Investment Securities | 12 Months Ended |
Dec. 31, 2019 | |
Investment Securities | |
Investment Securities | 8. Investment Securities Investment securities included in Settlement assets in the Company’s Consolidated Balance Sheets consist primarily of highly-rated state and municipal debt securities, including fixed-rate term notes and variable-rate demand notes. Variable-rate demand note securities can be put (sold at par), typically on a daily basis with settlement periods ranging from the same day to one week, but have varying maturities through 2051. These securities may be used by the Company for short-term liquidity needs and held for short periods of time. The Company is required to hold highly-rated, investment grade securities and such investments are restricted to satisfy outstanding settlement obligations in accordance with applicable regulatory requirements. Substantially all of the Company’s investment securities are classified as available-for-sale and recorded at fair value. Investment securities are exposed to market risk due to changes in interest rates and credit risk. Western Union regularly monitors credit risk and attempts to mitigate its exposure by investing in highly-rated securities and through investment diversification. Unrealized gains and losses on available-for-sale securities are excluded from earnings and presented as a component of Accumulated other comprehensive loss, net of related deferred taxes. Proceeds from the sale and maturity of available-for-sale securities during the years ended December 31, 2019, 2018, and 2017 were $5.4 billion, $7.7 billion, and $7.9 billion, respectively. Gains and losses on investment securities are calculated using the specific-identification method and are recognized in earnings during the period in which the investment is sold or when an investment experiences an other-than-temporary decline in value. Factors that could indicate an impairment exists include, but are not limited to: (i) earnings performance, (ii) changes in credit rating, or (iii) adverse changes in the regulatory or economic environment of the asset. If potential impairment exists, the Company assesses (i) whether it has the intent to sell the investment security, (ii) will more likely than not be required to sell the investment security before its anticipated recovery, or (iii) expects that some of the contractual cash flows will not be received. The Company had no material, other-than-temporary impairments during the periods presented. The components of investment securities are as follows (in millions): Gross Gross Net Amortized Fair Unrealized Unrealized Unrealized December 31, 2019 Cost Value Gains Losses Gains/(Losses) Settlement assets: Cash and cash equivalents: Money market funds $ 24.6 $ 24.6 $ — $ — $ — Available-for-sale securities: State and municipal debt securities (a) 1,227.4 1,257.8 31.0 (0.6) 30.4 State and municipal variable-rate demand notes 276.1 276.1 — — — United States government agency mortgage-backed securities 66.3 67.2 0.9 — 0.9 Corporate debt securities 52.3 52.4 0.1 — 0.1 Other United States government agency debt securities 34.9 34.9 — — — United States Treasury securities 9.8 10.0 0.2 — 0.2 Total investment securities within Settlement assets 1,666.8 1,698.4 32.2 (0.6) 31.6 Total investment securities $ 1,691.4 $ 1,723.0 $ 32.2 $ (0.6) $ 31.6 Gross Gross Net Amortized Fair Unrealized Unrealized Unrealized December 31, 2018 Cost Value Gains Losses Gains/(Losses) Cash and cash equivalents: Money market funds $ 27.0 $ 27.0 $ — $ — $ — Settlement assets: Cash and cash equivalents: Money market funds 23.9 23.9 — — — Available-for-sale securities: State and municipal debt securities (a) 963.4 962.7 6.1 (6.8) (0.7) State and municipal variable-rate demand notes 168.7 168.7 — — — Corporate and other debt securities 70.0 69.5 — (0.5) (0.5) United States Treasury securities 9.9 9.7 — (0.2) (0.2) Total investment securities within Settlement assets 1,212.0 1,210.6 6.1 (7.5) (1.4) Other assets: Held-to-maturity securities: Foreign corporate debt securities 32.9 32.9 — — — Total investment securities $ 1,295.8 $ 1,294.4 $ 6.1 $ (7.5) $ (1.4) (a) The majority of these securities are fixed-rate instruments. There were no investments with a single issuer or individual securities representing greater than 10% of total investment securities as of December 31, 2019 and 2018. The following summarizes the contractual maturities of investment securities within Settlement assets as of December 31, 2019 (in millions): Fair Value Due within 1 year $ 182.5 Due after 1 year through 5 years 572.2 Due after 5 years through 10 years 525.3 Due after 10 years 418.4 $ 1,698.4 Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay the obligations or the Company may have the right to put the obligation prior to its contractual maturity, as with variable-rate demand notes. Variable-rate demand notes, having a fair value of $7.6 million, $17.9 million, $11.0 million, and $239.6 million are included in the “Due within 1 year,” “Due after 1 years through 5 years,” “Due after 5 years through 10 years,” and “Due after 10 years” categories, respectively, in the table above. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Fair Value Measurements | 9. Fair Value Measurements Fair value, as defined by the relevant accounting standards, represents the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Refer to Note 2 for additional information on how the Company measures fair value. The following tables present the Company’s assets and liabilities which are measured at fair value on a recurring basis, by balance sheet line item (in millions): Fair Value Measurement Using Total December 31, 2019 Level 1 Level 2 Fair Value Assets: Settlement assets: Measured at fair value through net income: Money market funds $ 24.6 $ — $ 24.6 Measured at fair value through other comprehensive income: State and municipal debt securities — 1,257.8 1,257.8 State and municipal variable-rate demand notes — 276.1 276.1 United States government agency mortgage-backed securities — 67.2 67.2 Corporate debt securities — 52.4 52.4 Other United States government agency debt securities — 34.9 34.9 United States Treasury securities 10.0 — 10.0 Other assets: Derivatives — 204.5 204.5 Total assets $ 34.6 $ 1,892.9 $ 1,927.5 Liabilities: Other liabilities: Derivatives $ — $ 159.5 $ 159.5 Total liabilities $ — $ 159.5 $ 159.5 Fair Value Measurement Using Total December 31, 2018 Level 1 Level 2 Fair Value Assets: Cash and cash equivalents: Measured at fair value through net income: Money market funds $ 27.0 $ — $ 27.0 Settlement assets: Measured at fair value through net income: Money market funds 23.9 — 23.9 Measured at fair value through other comprehensive income: State and municipal debt securities — 962.7 962.7 State and municipal variable-rate demand notes — 168.7 168.7 Corporate and other debt securities — 69.5 69.5 United States Treasury securities 9.7 — 9.7 Other assets: Derivatives — 245.5 245.5 Total assets $ 60.6 $ 1,446.4 $ 1,507.0 Liabilities: Other liabilities: Derivatives $ — $ 176.2 $ 176.2 Total liabilities $ — $ 176.2 $ 176.2 No material, non-recurring fair value adjustments or transfers between Level 1 Level 2 December 31, 2019 Other Fair Value Measurements The carrying amounts for many of the Company’s financial instruments, including certain cash and cash equivalents, settlement cash and cash equivalents, and settlement receivables and settlement obligations approximate fair value due to their short maturities. The Company’s borrowings are classified as Level 2 within the valuation hierarchy, and the aggregate fair value of these borrowings was based on quotes from multiple banks. Fixed-rate notes are carried in the Company’s Consolidated Balance Sheets at their original issuance values as adjusted over time to accrete that value to par. As of December 31, 2019, the carrying value and fair value of the Company’s borrowings were $3,229.3 million and $3,372.2 million, respectively (see Note 16). As of December 31, 2018, the carrying value and fair value of the Company’s borrowings were $3,433.7 million and $3,394.6 million, respectively. As of December 31, 2018, the Company held investments in foreign corporate debt securities deemed to be held-to-maturity and classified as Level 2 within the valuation hierarchy. These investments were recorded at amortized cost in Other assets in the Company’s Consolidated Balance Sheets. As of December 31, 2018 |
Other Assets and Other Liabilit
Other Assets and Other Liabilities | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets and Other Liabilities | |
Other Assets and Other Liabilities | 10. Other Assets and Other Liabilities The following table summarizes the components of Other assets and Other liabilities (in millions): December 31, 2019 2018 Other assets: Derivatives $ 204.5 $ 245.5 ROU assets (Note 13) 199.7 — Prepaid expenses 102.4 101.3 Amounts advanced to agents 96.4 57.6 Equity method investments 33.0 31.3 Other (a) 126.9 180.3 Total other assets $ 762.9 $ 616.0 Other liabilities: Operating lease liabilities (Note 13) $ 242.3 $ — Derivatives 159.5 176.2 Pension obligations 11.4 16.0 Other 85.1 86.9 Total other liabilities $ 498.3 $ 279.1 (a) Property, equipment, and land of $49.3 million, which is primarily related to the Company’s former headquarters, is included in Other as of December 31, 2019 and is classified as held for sale. In the first quarter of 2020, the Company sold its former corporate headquarters and expects to record an immaterial gain on the sale. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Income Taxes | 11. Income Taxes The components of pre-tax income, generally based on the jurisdiction of the legal entity, were as follows (in millions): Year Ended December 31, 2019 2018 2017 Domestic $ 434.7 $ (11.4) $ (238.8) Foreign 886.7 1,002.8 586.3 Total pre-tax income $ 1,321.4 $ 991.4 $ 347.5 For the years ended December 31, 2019, 2018, and 2017, 67%, 101% and 169% of the Company’s pre-tax income was derived from foreign sources, respectively. During the year ended December 31, 2019, the Company’s domestic pre-tax income increased due to the net gain on the sales of the Speedpay and Paymap businesses, as discussed in Note 5. For the year ended December 31, 2017, domestic pre-tax loss was primarily the result of the domestic portion of the goodwill impairment charge related to the Company’s Business Solutions reporting unit, described further in Note 5, the NYDFS Consent Order accrual, as discussed in Note 6, and business transformation expenses. The provision for income taxes was as follows (in millions): Year Ended December 31, 2019 2018 2017 Federal $ 153.7 $ 62.9 $ 848.5 State and local 22.9 0.6 5.4 Foreign 86.5 76.0 50.7 Total provision for income taxes $ 263.1 $ 139.5 $ 904.6 In 2019, the Company’s federal and state and local tax provisions increased due to the net gain on the sales of the Speedpay and Paymap businesses. In 2017, the Tax Act was enacted into United States law, and a domestic one-time tax was imposed under the Tax Act on the Company’s previously undistributed earnings of foreign subsidiaries, with certain exceptions, partially offset by the remeasurement of deferred tax assets and liabilities and other tax balances to reflect the lower federal income tax rate. No tax benefit was recorded in 2017 for the $60 million NYDFS Consent Order accrual. In addition, certain portions of the Company’s foreign source income are subject to ongoing United States federal and state income tax as earned due to the nature of the income, and dividend repatriations of the Company’s foreign source income may be subject to state income tax. Accordingly, the percentage obtained by dividing the total federal, state and local tax provision by the domestic pre-tax income, all as shown in the preceding tables, is higher than the statutory tax rates in the United States. The Company’s effective tax rates differed from statutory rates as follows: Year Ended December 31, 2019 2018 2017 Federal statutory rate 21.0 % 21.0 % 35.0 % State income taxes, net of federal income tax benefits 1.4 % 0.4 % 1.7 % Foreign rate differential, net of United States tax paid on foreign earnings (2.3%, 4.9%, and 1.1%, respectively) (5.5) % (8.2) % (69.3) % Divestitures 2.4 % — % — % Tax Act impact — % 2.3 % 251.5 % NYDFS Consent Order impact — % — % 6.0 % Goodwill impairment — % — % 46.7 % Base erosion anti-abuse tax (BEAT) — % 3.0 % — % Lapse of statute of limitations (0.5) % (2.2) % (10.0) % Valuation allowances 0.1 % — % 0.8 % Other 1.0 % (2.2) % (2.1) % Effective tax rate 19.9 % 14.1 % 260.3 % The increase in the Company’s effective tax rate for the year ended December 31, 2019 compared to the prior year is primarily due to an increase in 2019 domestic pre-tax income due to the net gain on the sales of the Speedpay and Paymap businesses and certain discrete items recognized in the prior year, partially offset by adjustments to the Company's accounting for the implementation of the Tax Act, as finalized in the fourth quarter of 2018. The Company’s provision for income taxes consisted of the following components (in millions): Year Ended December 31, 2019 2018 2017 Current: Federal $ 169.4 $ 69.2 $ 774.4 State and local 18.1 — 1.0 Foreign 100.1 85.4 59.7 Total current taxes 287.6 154.6 835.1 Deferred: Federal (15.7) (6.3) 74.1 State and local 4.8 0.6 4.4 Foreign (13.6) (9.4) (9.0) Total deferred taxes (24.5) (15.1) 69.5 $ 263.1 $ 139.5 $ 904.6 Deferred tax assets and liabilities are recognized for the expected tax consequences of temporary differences between the book and tax bases of the Company’s assets and liabilities. The following table outlines the principal components of deferred tax items (in millions): December 31, 2019 2018 Deferred tax assets related to: Reserves, accrued expenses and employee-related items $ 38.3 $ 42.6 Lease liabilities 28.1 — Tax attribute carryovers 31.7 29.9 Pension obligations 4.0 4.8 Intangibles, property and equipment 13.6 8.5 Other 5.3 5.3 Valuation allowance (19.1) (15.7) Total deferred tax assets 101.9 75.4 Deferred tax liabilities related to: Intangibles, property and equipment 214.8 228.0 Lease right-of-use assets 18.7 — Other 6.9 — Total deferred tax liabilities 240.4 228.0 Net deferred tax liability (a) $ 138.5 $ 152.6 (a) As of December 31, 2019 and 2018, deferred tax assets that cannot be fully offset by deferred tax liabilities in the respective tax jurisdictions of $13.6 million and $8.5 million, respectively, are reflected in Other assets in the Consolidated Balance Sheets. The valuation allowances are primarily the result of uncertainties regarding the Company’s ability to recognize tax benefits associated with certain United States foreign tax credit carryforwards and certain foreign and state net operating losses. Such uncertainties include generating sufficient United States foreign tax credit limitation related to passive income and generating sufficient income. Changes in circumstances, or the identification and implementation of relevant tax planning strategies, could make it foreseeable that the Company will recover these deferred tax assets in the future, which could lead to a reversal of these valuation allowances and a reduction in income tax expense. Outside tax basis differences of approximately $493 million as of December 31, 2019 primarily relate to remaining undistributed foreign earnings not subject to the tax on certain previously undistributed earnings of foreign subsidiaries pursuant to the Tax Act and additional outside basis difference inherent in certain entities. To the extent such outside basis differences are attributable to undistributed earnings not already subject to United States tax, such undistributed earnings continue to be indefinitely reinvested in foreign operations. Upon the future realization of the Company’s basis difference, the Company could be subject to United States income taxes, state income taxes and possible withholding taxes payable to various foreign countries. However, determination of this amount of unrecognized deferred tax liability is not practicable because of complexities associated with its hypothetical calculation. As previously discussed, the Tax Act imposed a tax on certain of the Company’s previously undistributed foreign earnings. This tax charge, combined with the Company’s other 2017 United States taxable income and tax attributes, resulted in a 2017 United States federal tax liability of approximately $800 million, of which approximately $668 million remained as of December 31, 2019. The Company has elected to pay this liability in periodic installments through 2025. During both the years ended December 31, 2019 and 2018, the Company made installment payments of $64.0 million. Uncertain Tax Positions The Company has established contingency reserves for a variety of material, known tax exposures. As of December 31, 2019, the total amount of tax contingency reserves was $309.0 million, including accrued interest and penalties, net of related items. The Company’s tax reserves reflect management’s judgment as to the resolution of the issues involved if subject to judicial review or other settlement. While the Company believes its reserves are adequate to cover reasonably expected tax risks, there can be no assurance that, in all instances, an issue raised by a tax authority will be resolved at a financial cost that does not exceed its related reserve. With respect to these reserves, the Company’s income tax expense would include (i) any changes in tax reserves arising from material changes during the period in the facts and circumstances (i.e., new information) surrounding a tax issue and (ii) any difference from the Company’s tax position as recorded in the financial statements and the final resolution of a tax issue during the period. Such resolution could materially increase or decrease income tax expense in the Company’s consolidated financial statements in future periods and could impact operating cash flows. Unrecognized tax benefits represent the aggregate tax effect of differences between tax return positions and the amounts otherwise recognized in the Company’s consolidated financial statements, and are reflected in Income taxes payable in the Consolidated Balance Sheets. A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows (in millions): 2019 2018 Balance as of January 1 $ 295.0 $ 329.0 Increase related to current period tax positions (a) 5.2 4.0 Increase related to prior period tax positions 0.8 0.4 Decrease related to prior period tax positions (1.6) (18.5) Decrease due to lapse of applicable statute of limitations (5.3) (17.7) Increase/(decrease) due to effects of foreign currency exchange rates (0.2) (2.2) Balance as of December 31 $ 293.9 $ 295.0 (a) Includes recurring accruals for issues which initially arose in previous periods. The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $283.4 million and $284.2 million as of December 31, 2019 and 2018, respectively, excluding interest and penalties. The Company recognizes interest and penalties with respect to unrecognized tax benefits in Provision for income taxes in its Consolidated Statements of Income/(Loss), and records the associated liability in Income taxes payable in its Consolidated Balance Sheets. The Company recognized $6.0 million, $(0.7) million, and $2.2 million in interest and penalties during the years ended December 31, 2019, 2018, and 2017, respectively. The Company has accrued $27.1 million and $23.9 million for the payment of interest and penalties as of December 31, 2019 and 2018, respectively. The unrecognized tax benefits accrual as of December 31, 2019 consists of federal, state and foreign tax matters. It is reasonably possible that the Company’s total unrecognized tax benefits will decrease by approximately $4 million during the next 12 months in connection with various matters which may be resolved. The Company and its subsidiaries file tax returns for the United States, for multiple states and localities, and for various non-United States jurisdictions, and the Company has identified the United States as its major tax jurisdiction, as the income tax imposed by any one foreign country is not material to the Company. The Company’s United States federal income tax returns since 2016 are eligible to be examined. The United States Internal Revenue Service (“IRS”) completed its examination of the 2003 and 2004 United States federal consolidated income tax returns of First Data Corporation, from which the Company was spun out in September 2006, and issued a Notice of Deficiency in December 2008. In December 2011, the Company reached an agreement with the IRS resolving substantially all of the issues related to the Company’s restructuring of its international operations in 2003 (“IRS Agreement”). The Company has made payments related to the IRS Agreement in years prior to 2018, with a substantial majority of these payments in the year ended December 31, 2012. During the year ended December 31, 2018, the Company made cash payments under the IRS Agreement of approximately $120 million, including accrued interest and net of related tax benefits. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Employee Benefit Plans | |
Employee Benefit Plans | 12. Employee Benefit Plans Defined Contribution Plans The Company administers several defined contribution plans in various countries globally, including The Western Union Company Incentive Savings Plan (the “401(k)”), which covers eligible employees on the United States payroll. Such plans have vesting and employer contribution provisions that vary by country. In addition, the Company sponsors a non-qualified deferred compensation plan for a select group of highly compensated United States employees. The plan provides tax-deferred contributions and the restoration of Company matching contributions otherwise limited under the 401(k). The aggregate amount charged to expense in connection with all of the above plans was $20.0 million for both the years ended December 31, 2019 and 2018, and $19.2 million for the year ended December 31, 2017. Defined Benefit Plan The Company has a frozen defined benefit pension plan (the “Plan”) and recognizes its funded status, measured as the difference between the fair value of the plan assets and the projected benefit obligation, in Other liabilities in the Consolidated Balance Sheets. Plan assets, which are managed in a third-party trust, primarily consist of a diversified blend of approximately 60% fixed income, 20% equity investments, and 20% alternative investments (e.g., hedge funds, royalty rights and private equity funds) and had a total fair value of $237.1 million and $234.8 million as of December 31, 2019 and 2018, respectively. The significant majority of plan assets are classified as either Level 1 or Level 2 within the valuation hierarchy or are valued at net asset value, which is not quoted on an active market; however, the unit price is based on underlying investments which are traded on an active market. The benefit obligation associated with the Plan will vary over time only as a result of changes in market interest rates, the life expectancy of the plan participants, and benefit payments, since the accrual of benefits was suspended when the Plan was frozen in 1988. The benefit obligation was $248.5 million and $250.8 million, and the discount rate assumption used in the measurement of this obligation was 2.66% and 3.79% for the years ended December 31, 2019 and 2018, respectively. The Company’s unfunded pension obligation was $11.4 million and $16.0 million as of December 31, 2019 and 2018, respectively. The net periodic benefit cost associated with the Plan was $4.1 million, $3.3 million, and $2.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. The expected long-term return on plan assets assumption is 6.25% for 2020. The Company made no contributions to the Plan for both the years ended December 31, 2019 and 2018. No funding to the Plan will be required for 2020. The estimated undiscounted future benefit payments are expected to be $27.7 million in 2020, $25.9 million in 2021, $24.2 million in 2022, $22.5 million in 2023, $20.9 million in 2024, and $81.4 million in 2025 through 2029. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Leases | 13. Leases The Company leases real properties for use as administrative and sales offices, in addition to automobiles and office equipment. The Company determines if a contract contains a lease arrangement at the inception of the contract. For leases in which the Company is the lessee, leases are classified as either finance or operating, with classification affecting the pattern of expense recognition. Operating lease ROU assets are initially measured at the present value of lease payments over the lease term plus initial direct costs, if any. If a lease does not provide a discount rate and the rate cannot be readily determined, an incremental borrowing rate is used to determine the future lease payments. Lease and variable non-lease components within the Company’s lease agreements are accounted for separately. The Company has no material leases in which the Company is the lessor. Substantially all of the Company’s leasing arrangements are classified as operating leases, for which expense is recognized on a straight-line basis. As of December 31, 2019, the total ROU asset and operating lease liability were $199.7 million and $242.3 million, respectively, and were included in Other assets Other liabilities The Company’s leases have remaining terms from less than 1 year to 11 years. Certain of these leases contain escalation provisions and/or renewal options, giving the Company the right to extend the lease by up to 10 years. However, a substantial majority of these options are not reflected in the calculation of the ROU asset and operating lease liability due to uncertainty surrounding the likelihood of renewal. The following table summarizes the weighted-average lease term and discount rate for operating lease liabilities as of December 31, 2019: Weighted-average remaining lease term (in years) 7.6 Weighted-average discount rate 6.5 % The following table represents maturities of operating lease liabilities as of December 31, 2019 (in millions): Due within 1 year $ 53.2 Due after 1 year through 2 years 45.2 Due after 2 years through 3 years 38.5 Due after 3 years through 4 years 32.6 Due after 4 years through 5 years 30.5 Due after 5 years 102.5 Total lease payments 302.5 Less imputed interest (60.2) Total operating lease liabilities $ 242.3 For the years ended December 31, 2018 and 2017, total rent expense, net of sublease income, was $59.5 million and $51.1 million, respectively, as recorded under accounting standards in effect in these periods. As of December 31, 2018, the minimum aggregate rental commitments under all non-cancelable operating leases, as determined under accounting standards in effect in this period, were as follows (in millions): Year Ending December 31, 2019 $ 51.6 2020 44.1 2021 35.4 2022 31.4 2023 25.2 Thereafter 112.6 Total future minimum lease payments $ 300.3 |
Stockholders' Equity_(Deficit)
Stockholders' Equity/(Deficit) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity/(Deficit) | |
Stockholders' Equity/(Deficit) | 14. Stockholders’ Equity/(Deficit) Accumulated Other Comprehensive Loss AOCL includes all changes in equity during a period that have not yet been recognized in income, except those resulting from transactions with shareholders. The components include unrealized gains and losses on investment securities, unrealized gains and losses from cash flow hedging activities, foreign currency translation adjustments, and defined benefit pension plan adjustments. Unrealized gains and losses on investment securities that are available for sale, primarily state and municipal debt securities, are included in AOCL until the investment is either sold or deemed other-than-temporarily impaired. See Note 8 for further discussion. The effective portion of the change in fair value of derivatives that qualifies as a cash flow hedge is recorded in AOCL. Generally, amounts are recognized in income when the related forecasted transaction affects earnings. See Note 15 for further discussion. While the United States dollar is the functional currency for substantially all of the Company’s businesses, the assets and liabilities of foreign subsidiaries whose functional currency is not the United States dollar are translated using the appropriate exchange rate as of the end of the year. Foreign currency translation adjustments represent unrealized gains and losses on assets and liabilities arising from the difference in these foreign currencies compared to the United States dollar. These gains and losses are accumulated in other comprehensive income/(loss). When a foreign subsidiary is substantially liquidated, the cumulative translation gain or loss is removed from AOCL and recognized as a component of the gain or loss on the sale of the subsidiary. The defined benefit pension plan adjustment is recognized for the difference between estimated assumptions (e.g., asset returns, discount rates, mortality) and actual results. The amount in AOCL is amortized to income over the remaining life expectancy of the plan participants. Details of the pension plan’s assets and obligations are explained further in Note 12. The following table details reclassifications out of AOCL and into Net income. All amounts reclassified from AOCL affect the line items as indicated below and the amounts in parentheses indicate decreases to Net income in the Consolidated Statements of Income/(Loss). Amounts Reclassified from AOCL to Net Income Income Statement Year Ended December 31, Income for the period (in millions) Location 2019 2018 2017 Accumulated other comprehensive loss components: Gains/(losses) on investment securities: Available-for-sale securities Revenues $ 0.6 $ (0.4) $ 2.4 Income tax (expense)/benefit Provision for income taxes (0.1) 0.1 (0.9) Total reclassification adjustments related to investment securities, net of tax 0.5 (0.3) 1.5 Gains/(losses) on cash flow hedges: Foreign currency contracts Revenues 14.2 (14.9) 4.8 Interest rate contracts Interest expense — (2.1) (3.3) Income tax (expense)/benefit Provision for income taxes (0.1) 0.7 1.2 Total reclassification adjustments related to cash flow hedges, net of tax 14.1 (16.3) 2.7 Amortization of components of defined benefit plans: Actuarial loss Other income, net (10.8) (11.7) (11.3) Income tax benefit Provision for income taxes 2.4 2.6 4.1 Total reclassification adjustments related to defined benefit plans, net of tax (8.4) (9.1) (7.2) Total reclassifications, net of tax $ 6.2 $ (25.7) $ (3.0) The following tables summarize the components of AOCL, net of tax in the accompanying Consolidated Balance Sheets (in millions): Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2018 $ (1.1) $ 7.4 $ (101.2) $ (136.1) $ (231.0) Unrealized gains/(losses) 33.6 2.0 — (2.0) 33.6 Tax benefit/(expense) (7.3) 1.1 — 0.8 (5.4) Amounts reclassified from AOCL into earnings, net of tax (0.5) (14.1) — 8.4 (6.2) As of December 31, 2019 $ 24.7 $ (3.6) $ (101.2) $ (128.9) $ (209.0) Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2017 $ 2.7 $ (40.6) $ (76.9) $ (113.1) $ (227.9) Unrealized gains/(losses) (5.9) 35.6 — (9.3) 20.4 Tax benefit/(expense) 1.3 (1.6) — 2.0 1.7 Amounts reclassified from AOCL into earnings, net of tax 0.3 16.3 — 9.1 25.7 Foreign currency translation adjustments (a) — — (19.5) — (19.5) Reclassification of Tax Act effects into Accumulated deficit (b) 0.5 (2.3) (4.8) (24.8) (31.4) As of December 31, 2018 $ (1.1) $ 7.4 $ (101.2) $ (136.1) $ (231.0) Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2016 $ (3.8) $ 33.8 $ (70.7) $ (122.1) $ (162.8) Unrealized gains/(losses) 12.6 (73.9) — 2.3 (59.0) Tax benefit/(expense) (4.6) 2.2 0.6 (0.5) (2.3) Amounts reclassified from AOCL into earnings, net of tax (1.5) (2.7) — 7.2 3.0 Foreign currency translation adjustments (a) — — (6.8) — (6.8) As of December 31, 2017 $ 2.7 $ (40.6) $ (76.9) $ (113.1) $ (227.9) (a) Beginning in the third quarter of 2018, all changes in the value of the Argentine peso on the Company’s monetary assets and liabilities are reflected in net income, given Argentina’s status as a highly inflationary economy. Prior to the third quarter of 2018, changes in the Argentine peso exchange rate were reflected in net income for the Company’s money transfer operations, whereas these effects were reflected in other comprehensive income for the Company’s bill payment operations. This designation did not have a material impact on the Company’s financial position and results of operations for the years ended December 31, 2019 and 2018. (b) As discussed in Note 2, in the first quarter of 2018, the Company adopted an accounting pronouncement as a result of the Tax Act and reclassified tax effects included within AOCL to Accumulated deficit in the Consolidated Balance Sheets. Cash Dividends Paid Cash dividends paid for the years ended December 31, 2019, 2018, and 2017 were $340.8 million, $341.7 million, and $325.6 million, respectively. Dividends per share declared quarterly by the Company’s Board of Directors during the years ended 2019, 2018, and 2017 were as follows: Year Q1 Q2 Q3 Q4 2019 $ 0.20 $ 0.20 $ 0.20 $ 0.20 2018 $ 0.19 $ 0.19 $ 0.19 $ 0.19 2017 $ 0.175 $ 0.175 $ 0.175 $ 0.175 On February 11, 2020, the Company’s Board of Directors declared a quarterly cash dividend of $0.225 per common share payable on March 31, 2020. Share Repurchases During the years ended December 31, 2019, 2018, and 2017, 26.9 million, 20.2 million, and 24.9 million shares, respectively, have been repurchased for $540.0 million, $399.2 million, and $487.0 million, respectively, excluding commissions, at an average cost of $20.07, $19.81, and $19.55 per share, respectively. These amounts represent shares authorized by the Board of Directors for repurchase under the publicly announced authorizations. As of December 31, 2019, $1.0 billion remained available under the share repurchase authorization approved by the Company’s Board of Directors through December 31, 2021. The amounts included in the Common stock repurchased line in the Company’s Consolidated Statements of Cash Flows represent both shares authorized by the Board of Directors for repurchase under publicly announced authorizations and shares withheld from employees to cover tax withholding obligations on restricted stock units that have vested. |
Derivatives
Derivatives | 12 Months Ended |
Dec. 31, 2019 | |
Derivatives | |
Derivatives | 15. Derivatives The Company is exposed to foreign currency exchange risk resulting from fluctuations in exchange rates, primarily the euro, and, to a lesser degree, the Canadian dollar, British pound, Australian dollar, and other currencies, related to forecasted revenues and settlement assets and obligations, as well as on certain foreign currency denominated cash and other asset and liability positions. The Company is also exposed to risk from derivative contracts, primarily from customer derivatives, arising from its cross-currency Business Solutions payment operations. Additionally, the Company is exposed to interest rate risk related to changes in market rates both prior to and subsequent to the issuance of debt. The Company uses derivatives to (i) minimize its exposures related to changes in foreign currency exchange rates and interest rates and (ii) facilitate cross-currency Business Solutions payments by writing derivatives to customers. The Company executes derivatives with established financial institutions; the substantial majority of these financial institutions have a credit rating of "A-" or higher from a major credit rating agency. Customer derivatives written by the Company’s Business Solutions operations primarily involve small and medium size enterprises. The primary credit risk inherent in derivative agreements represents the possibility that a loss may occur from the nonperformance of a counterparty to the agreements. The Company performs a review of the credit risk of these counterparties at the inception of the contract and on an ongoing basis, while also monitoring the concentration of its contracts with any individual counterparty. The Company anticipates that the counterparties will be able to fully satisfy their obligations under the agreements, but takes action when doubt arises about the counterparties’ ability to perform. These actions may include requiring Business Solutions customers to post or increase collateral, and for all counterparties, the possible termination of the related contracts. The Company’s hedged foreign currency exposures are in liquid currencies; consequently, there is minimal risk that appropriate derivatives to maintain the hedging program would not be available in the future. Foreign Currency Derivatives The Company’s policy is to use long duration foreign currency forward contracts, with maturities of up to 36 months at inception and a targeted weighted-average maturity of approximately one year, to help mitigate some of the risk that changes in foreign currency exchange rates compared to the United States dollar could have on forecasted revenues denominated in other currencies related to its business. As of December 31, 2019, these foreign currency forward contracts had maturities of a maximum of 24 months with a weighted-average maturity of approximately one year. These contracts are accounted for as cash flow hedges of forecasted revenue, with effectiveness assessed based on changes in the spot rate of the affected currencies during the period of designation and thus time value is excluded from the assessment of effectiveness. As described in Note 2, foreign currency cash flow hedges entered into on or after January 1, 2018 exclude time value from the assessment of effectiveness, and the initial value of the excluded components is amortized into Revenues within the Company’s Consolidated Statements of Income/(Loss). For foreign currency cash flow hedges entered into before January 1, 2018, all changes in the fair value of the excluded components are recognized immediately in Revenues. The Company also uses short duration foreign currency forward contracts, generally with maturities ranging from a few days to one month, to offset foreign exchange rate fluctuations on settlement assets and obligations between initiation and settlement. In addition, forward contracts, typically with maturities of less than one year at inception, are utilized to offset foreign exchange rate fluctuations on certain foreign currency denominated cash and other asset and liability positions. None of these contracts are designated as accounting hedges. The aggregate equivalent United States dollar notional amounts of foreign currency forward contracts as of December 31, 2019 and December 31, 2018 were as follows (in millions): December 31, 2019 Contracts designated as hedges: Euro $ 391.9 Canadian dollar 99.0 British pound 57.2 Australian dollar 36.1 Swiss franc 28.9 Other (a) 50.9 Contracts not designated as hedges: Euro $ 289.0 Canadian dollar 110.3 British pound 78.1 Indian rupee 61.0 Mexican peso 52.3 Japanese yen 37.7 Australian dollar 35.2 Brazilian real 32.5 Other (a) 145.6 (a) Comprised of exposures to various currencies as of December 31, 2019. None of these individual currency exposures is greater than $25 million. December 31, 2018 Contracts designated as hedges: Euro $ 364.7 Canadian dollar 97.1 British pound 76.4 Australian dollar 45.3 Japanese yen 25.2 Other (a) 50.1 Contracts not designated as hedges: Euro $ 274.4 British pound 81.5 Canadian dollar 46.0 Australian dollar 39.0 Indian rupee 37.2 Brazilian real 35.8 Japanese yen 34.3 Mexican peso 34.2 Other (a) 138.5 (a) Comprised of exposures to various currencies as of December 31, 2018. None of these individual currency exposures is greater than $25 million. Business Solutions Operations The Company writes derivatives, primarily foreign currency forward contracts and option contracts, mostly with small and medium size enterprises and derives a currency spread from this activity as part of its Business Solutions operations. The Company aggregates its Business Solutions foreign currency exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties (economic hedge contracts). The derivatives written are part of the broader portfolio of foreign currency positions arising from the Company’s cross-currency payments operations, which primarily include spot exchanges of currency in addition to forwards and options. Foreign exchange revenues from the total portfolio of positions were $343.1 million, $342.3 million, and $341.0 million for the years ended December 31, 2019, 2018, and 2017, respectively, and were included in Revenues in the Company’s Consolidated Statements of Income/(Loss). None of the derivative contracts used in Business Solutions operations are designated as accounting hedges and the duration of these derivative contracts at inception is generally less than one year. The aggregate equivalent United States dollar notional amount of derivative customer contracts held by the Company in its Business Solutions operations as of December 31, 2019 and December 31, 2018 was approximately $7.5 billion and $6.0 billion, respectively. The significant majority of customer contracts are written in the following currencies: the United States dollar, euro, and the Canadian dollar. Interest Rate Hedging From time to time, the Company utilizes interest rate swaps to effectively change the interest rate payments on a portion of its notes from fixed-rate payments to short-term, LIBOR-based, variable rate payments in order to manage its overall exposure to interest rate fluctuations. The Company designates these derivatives as fair value hedges. The change in fair value of the interest rate swaps is offset by a change in the carrying value of the debt being hedged within Borrowings in the Consolidated Balance Sheets. Interest expense in the Consolidated Statements of Income/(Loss) has been adjusted to include the effects of interest accrued on the swaps. As of December 31, 2018, the Company held interest rate swaps designated as fair value hedges, with an aggregate notional amount of $175.0 million, related to its unsecured notes that were due on April 1, 2020 (“2020 Notes”). On November 15, 2019, the Company terminated these swaps in connection with the repayment of the 2020 Notes and received cash of $0.9 million. Balance Sheet The following table summarizes the fair value of derivatives reported in the Company’s Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018 (in millions): Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet December 31, December 31, Balance Sheet December 31, December 31, Location 2019 2018 Location 2019 2018 Derivatives designated as hedges: Interest rate fair value hedges Other assets $ — $ 0.1 Other liabilities $ — $ — Foreign currency cash flow hedges Other assets 21.0 28.6 Other liabilities 4.8 2.8 Total derivatives designated as hedges $ 21.0 $ 28.7 $ 4.8 $ 2.8 Derivatives not designated as hedges: Business Solutions operations - foreign currency (a) Other assets $ 182.0 $ 214.2 Other liabilities $ 151.0 $ 170.9 Foreign currency Other assets 1.5 2.6 Other liabilities 3.7 2.5 Total derivatives not designated as hedges $ 183.5 $ 216.8 $ 154.7 $ 173.4 Total derivatives $ 204.5 $ 245.5 $ 159.5 $ 176.2 (a) In many circumstances, the Company allows its Business Solutions customers to settle part or all of their derivative contracts prior to maturity. However, the offsetting positions originally entered into with financial institution counterparties do not allow for similar settlement. To mitigate this, additional foreign currency contracts are entered into with financial institution counterparties to offset the original economic hedge contracts. This frequently results in changes in the Company’s derivative assets and liabilities that may not directly align with the performance in the underlying derivatives business. The fair values of derivative assets and liabilities associated with contracts that include netting language that the Company believes to be enforceable have been netted in the following tables to present the Company’s net exposure with these counterparties. The Company’s rights under these agreements generally allow for transactions to be settled on a net basis, including upon early termination, which could occur upon the counterparty’s default, a change in control, or other conditions. In addition, certain of the Company’s other agreements include netting provisions, the enforceability of which may vary from jurisdiction to jurisdiction and depending on the circumstances. Due to the uncertainty related to the enforceability of these provisions, the derivative balances associated with these agreements are included within "Derivatives that are not or may not be subject to master netting arrangement or similar agreement" in the following tables. In certain circumstances, the Company may require its Business Solutions customers to maintain collateral balances which may mitigate the risk associated with potential customer defaults. The following tables summarize the gross and net fair value of derivative assets and liabilities as of December 31, 2019 and December 31, 2018 (in millions): Offsetting of Derivative Assets Gross Net Amounts Derivatives Gross Amounts Presented Not Offset Amounts of Offset in the in the in the Recognized Consolidated Consolidated Consolidated December 31, 2019 Assets Balance Sheets Balance Sheets Balance Sheets Net Amounts Derivatives subject to a master netting arrangement or similar agreement $ 95.3 $ — $ 95.3 $ (74.7) $ 20.6 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 109.2 Total $ 204.5 December 31, 2018 Derivatives subject to a master netting arrangement or similar agreement $ 162.6 $ — $ 162.6 $ (95.7) $ 66.9 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 82.9 Total $ 245.5 Offsetting of Derivative Liabilities Gross Net Amounts Derivatives Gross Amounts Presented Not Offset Amounts of Offset in the in the in the Recognized Consolidated Consolidated Consolidated December 31, 2019 Liabilities Balance Sheets Balance Sheets Balance Sheets Net Amounts Derivatives subject to a master netting arrangement or similar agreement $ 121.8 $ — $ 121.8 $ (74.7) $ 47.1 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 37.7 Total $ 159.5 December 31, 2018 Derivatives subject to a master netting arrangement or similar agreement $ 104.1 $ — $ 104.1 $ (95.7) $ 8.4 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 72.1 Total $ 176.2 Income Statement Cash Flow and Fair Value Hedges The effective portion of the change in fair value of derivatives that qualify as cash flow hedges is recorded in AOCL in the Company’s Consolidated Balance Sheets. Generally, amounts are recognized in income when the related forecasted transaction affects earnings. The following table presents the pre-tax amount of unrealized gains/(losses) recognized in other comprehensive income from cash flow hedges for the years ended December 31, 2019, 2018, and 2017 (in millions): 2019 2018 2017 Foreign currency derivatives (a) $ 2.0 $ 35.6 $ (73.9) (a) For the years ended December 31, 2019 and 2018, gains of $1.5 million and $0.1 million, respectively, represent the amounts excluded from the assessment of effectiveness that were recognized in other comprehensive income, for which an amortization approach is applied. For the year ended December 31, 2017, there were no amounts recorded in other comprehensive income for amounts excluded from the measurement of effectiveness. The following table presents the location and amount of pre-tax net gains/(losses) from fair value and cash flow hedging relationships recognized in the Consolidated Statements of Income/(Loss) for the years ended December 31, 2019, 2018, and 2017 (in millions): 2019 2018 2017 Other Interest Interest Interest Income, Revenues Expense Revenues Expense Revenues Expense Net Total amounts presented in the Consolidated Statements of Income/(Loss) in which the effects of fair value or cash flow hedges are recorded $ 5,292.1 $ (152.0) $ 5,589.9 $ (149.6) $ 5,524.3 $ (142.1) $ 8.9 The effects of fair value and cash flow hedging: Gain/(loss) on fair value hedges: Interest rate derivatives: Hedged items — (0.1) — 0.6 — 3.9 — Derivatives designated as hedging instruments — 1.0 — (1.6) — (2.0) — Gain/(loss) on cash flow hedges: Foreign currency derivatives: Gains/(losses) reclassified from AOCL into earnings 14.2 — (14.9) — 4.8 — — Amount excluded from effectiveness testing recognized in earnings based on an amortization approach 11.5 — 4.3 — — — — Amount excluded from effectiveness testing recognized in earnings based on changes in fair value 2.9 — 7.5 — — — 9.0 Losses reclassified from AOCL into income resulting from forecasted transactions no longer probable of occurring — — — — — — (1.4) Undesignated Hedges The following table presents the location and amount of pre-tax net gains/(losses) from undesignated hedges for the years ended December 31, 2019, 2018, and 2017 (in millions): Gain/(Loss) Recognized in the Consolidated Statements of Income/(Loss) on Derivatives (a) Derivatives Location 2019 2018 2017 Foreign currency derivatives (b) Selling, general, and administrative $ 23.9 $ 58.6 $ (20.5) Foreign currency derivatives (c) Revenues 0.3 3.0 — Foreign currency derivatives (c) Other income, net — (1.8) (0.5) Total gain/(loss) $ 24.2 $ 59.8 $ (21.0) (a) The Company uses foreign currency forward and option contracts as part of its Business Solutions payments operations. These derivative contracts are excluded from this table as they are managed as part of a broader currency portfolio that includes non-derivative currency exposures. The gains and losses on these derivatives are included as part of the broader disclosure of portfolio revenue for this business discussed above. (b) The Company uses foreign currency forward contracts to offset foreign exchange rate fluctuations on settlement assets and obligations, as well as certain foreign currency denominated positions. Foreign exchange gains/(losses) on settlement assets and obligations, cash balances, and other assets and liabilities, not including amounts related to derivative activity as displayed above, and included in Selling, general, and administrative in the Consolidated Statements of Income/(Loss), were $(33.1) million, $(52.3) million, and $17.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. (c) All derivative contracts executed in the Company’s revenue hedging program prior to January 1, 2018 are not designated as hedges in the final month of the contract. The change in fair value in this final month was recorded to Revenues for the year ended December 31, 2018 and Other income, net for the year ended December 31, 2017. The amount recorded to Other income, net for the year ended December 31, 2018 relates to losses on certain undesignated foreign currency derivative contracts that were recognized after the Company determined that certain forecasted transactions were no longer probable of occurring. All cash flows associated with derivatives are included in Cash flows from operating activities in the Consolidated Statements of Cash Flows. Based on December 31, 2019 foreign exchange rates, an accumulated other comprehensive pre-tax gain of $5.7 million related to the foreign currency forward contracts is expected to be reclassified into Revenues within the next 12 months. |
Borrowings
Borrowings | 12 Months Ended |
Dec. 31, 2019 | |
Borrowings | |
Borrowings | 16. Borrowings The Company’s outstanding borrowings consisted of the following (in millions): December 31, 2019 December 31, 2018 Commercial paper $ 245.0 $ 125.0 Notes: 3.350% notes due 2019 (a) — 250.0 Floating rate notes due 2019 (a) — 250.0 5.253% notes due 2020 (b) — 324.9 3.600% notes due 2022 (c) 500.0 500.0 4.250% notes due 2023 (c) 300.0 300.0 2.850% notes due 2025 (effective rate of 3.1%) (d) 500.0 — 6.200% notes due 2036 (c) 500.0 500.0 6.200% notes due 2040 (c) 250.0 250.0 Term loan facility borrowing (effective rate of 3.1%) 950.0 950.0 Total borrowings at par value 3,245.0 3,449.9 Fair value hedge accounting adjustments, net (e) — (0.1) Debt issuance costs and unamortized discount, net (15.7) (16.1) Total borrowings at carrying value (f) $ 3,229.3 $ 3,433.7 (a) Proceeds from the Speedpay divestiture, commercial paper, and cash, including cash generated from operations, were used to repay the May 2019 maturities of the $250.0 million of aggregate principal amount unsecured notes and $250.0 million of aggregate principal amount unsecured floating rate notes. (b) Proceeds from the 2.850% unsecured notes due in 2025 were used to repay the 2020 Notes of $324.9 million of aggregate principal amount unsecured notes, as further described below. (c) The difference between the stated interest rate and the effective interest rate is not significant. (d) On November 25, 2019, the Company issued $500.0 million of aggregate principal amount of 2.850% unsecured notes due in 2025, as further described below. (e) From time to time, the Company utilizes interest rate swaps designated as fair value hedges to effectively change the interest rate payments on a portion of its notes from fixed-rate payments to short-term LIBOR-based variable-rate payments in order to manage its overall exposure to interest rates. The changes in fair value of these interest rate swaps result in an offsetting hedge accounting adjustment recorded to the carrying value of the related note. These hedge accounting adjustments will be reclassified as reductions to or increases in Interest expense in the Consolidated Statements of Income/(Loss) over the life of the related notes and cause the effective rate of interest to differ from the notes’ stated rate. On November 15, 2019, the Company terminated these fair value hedges in connection with its repayment of the 2020 Notes and received cash of $0.9 million. (f) As of December 31, 2019, the Company’s weighted-average effective rate on total borrowings was approximately 4.0% . The following summarizes the Company’s maturities of notes and term loan at par value as of December 31, 2019 (in millions): Due within 1 year $ — Due after 1 year through 2 years 47.5 Due after 2 years through 3 years 547.5 Due after 3 years through 4 years 395.0 Due after 4 years through 5 years 760.0 Due after 5 years 1,250.0 The Company’s obligations with respect to its outstanding borrowings, as described below, rank equally. Commercial Paper Program Pursuant to the Company’s commercial paper program, the Company may issue unsecured commercial paper notes in an amount not to exceed $1.5 billion outstanding at any time, reduced to the extent of borrowings outstanding on the Company’s Revolving Credit Facility as defined below. The commercial paper borrowings may have maturities of up to 397 days from date of issuance. The Company’s commercial paper borrowings as of December 31, 2019 had a weighted-average annual interest rate of approximately 2.1% and a weighted-average term of approximately 3 days. As of December 31, 2019 and 2018, the Company had $245.0 million and $125.0 million in commercial paper borrowings outstanding, respectively. Revolving Credit Facility On December 18, 2018, the Company entered into a credit agreement with an original expiration date of January 2024 providing for unsecured financing facilities in an aggregate amount of $1.5 billion, including a $250.0 million letter of credit sub-facility (“Revolving Credit Facility”). Consistent with the prior facility, and the Term Loan Facility, as described below, the Company is required to maintain compliance with a consolidated adjusted EBITDA interest coverage ratio covenant of greater than 3:1 for each period of four consecutive fiscal quarters. The Revolving Credit Facility supports borrowings under the Company’s commercial paper program. Interest due under the Revolving Credit Facility is fixed for the term of each borrowing and is payable according to the terms of that borrowing. Generally, interest is calculated using a selected LIBOR rate plus an interest rate margin of 110 basis points. A facility fee of 15 basis points is also payable quarterly on the total facility, regardless of usage. Both the interest rate margin and facility fee percentage are based on certain of the Company’s credit ratings. As of December 31, 2019 and 2018, the Company had no outstanding borrowings under its revolving credit facility. On December 18, 2019, the Company extended the final maturity date of the Revolving Credit Facility to January 8, 2025. Term Loan Facility On December 18, 2018, the Company extended the Term Loan Facility providing for an unsecured delayed draw term loan facility in an aggregate amount of $950.0 million. In October 2016, the Company borrowed $575.0 million under the prior term loan facility. In December 2018, the Company borrowed the remaining amount available under the Term Loan Facility. The Term Loan Facility requires the Company to maintain a consolidated adjusted EBITDA interest coverage ratio of greater than 3:1 for each period of four consecutive fiscal quarters. The Term Loan Facility also contains customary representations, warranties and events of default. Generally, interest under the Term Loan Facility is calculated using a selected LIBOR rate plus an interest rate margin of 125 basis points. The interest rate margin percentage is based on certain of the Company’s credit ratings and will increase or decrease in the event of certain upgrades or downgrades in the Company’s credit ratings. In addition to the payment of interest, the Company is required to make certain periodic amortization payments with respect to the outstanding principal of the term loan, beginning in 2021. The final maturity date of the Term Loan Facility is January 8, 2024. Under the terms of the prior term loan facility, the Company was required to make certain amortization payments with respect to the outstanding principal of the prior term loan facility. For the year ended December 31, 2018, the Company made amortization payments of $14.4 million prior to the extension of the term loan agreement. Notes On November 25, 2019, the Company issued $500.0 million of aggregate principal amount of unsecured notes due January 10, 2025 (“2025 Notes”). The Company used the net proceeds from the sale of the 2025 Notes to redeem the Company’s 2020 Notes and for general corporate purposes. Interest with respect to the 2025 Notes is payable semi-annually in arrears on January 10 and July 10 of each year, beginning on July 10, 2020, based on the per annum rate of 2.850%. The interest rate payable on the 2025 Notes will be increased if the debt rating assigned to these notes is downgraded by an applicable credit rating agency, beginning at a downgrade below investment grade. However, in no event will the interest rate on the 2025 Notes exceed 4.850% per annum. The interest rate payable on the 2025 Notes may also be adjusted downward for debt rating upgrades subsequent to any debt rating downgrades but may not be adjusted below 2.850% per annum. The Company may redeem the 2025 Notes, in whole or in part, at any time prior to December 10, 2024 at the greater of par or a price based on the applicable treasury rate plus 20 basis points. The Company may redeem the 2025 Notes at any time after December 10, 2024 at a price equal to par, plus accrued interest. On June 11, 2018, the Company issued $300.0 million of aggregate principal amount of unsecured notes due June 9, 2023 (“2023 Notes”). Interest with respect to the 2023 Notes is payable semi-annually in arrears on June 9 and December 9 of each year, beginning on December 9, 2018, based on the per annum rate of 4.250%. The interest rate payable on the 2023 Notes will be increased if the debt rating assigned to these notes is downgraded by an applicable credit rating agency, beginning at a downgrade below investment grade. However, in no event will the interest rate on the 2023 Notes exceed 6.250% per annum. The interest rate payable on the 2023 Notes may also be adjusted downward for debt rating upgrades subsequent to any debt rating downgrades but may not be adjusted below 4.250% per annum. The Company may redeem the 2023 Notes, in whole or in part, at any time prior to May 9, 2023 at the greater of par or a price based on the applicable treasury rate plus 25 basis points. The Company may redeem the 2023 Notes at any time after May 9, 2023 at a price equal to par, plus accrued interest. On August 22, 2017, the Company issued $250.0 million of aggregate principal amount of unsecured floating rate notes due May 22, 2019 (“Floating Rate Notes”). The Floating Rate Notes were repaid in May 2019 using proceeds from the Speedpay divestiture (see Note 5), commercial paper, and cash, including cash generated from operations. On March 15, 2017, the Company issued $400.0 million of aggregate principal amount of unsecured notes due March 15, 2022. On August 22, 2017, the Company issued an additional $100.0 million of aggregate principal amount of unsecured notes due March 15, 2022 (“2022 Notes”). The notes issued on August 22, 2017 are part of the same series and, accordingly, have the same terms and conditions as the notes issued on March 15, 2017; however, the notes issued on August 22, 2017 were issued at a premium of 101.783% and the Company received $1.57 million of accrued interest upon issuance. Interest with respect to the 2022 Notes is payable semi-annually in arrears on March 15 and September 15 of each year, beginning on September 15, 2017, based on the per annum rate of 3.600%. The interest rate payable on the 2022 Notes will be increased if the debt rating assigned to the note is downgraded by an applicable credit rating agency, beginning at a downgrade below investment grade. However, in no event will the interest rate on the 2022 Notes exceed 5.60% per annum. The interest rate payable on the 2022 Notes may also be adjusted downward for debt rating upgrades subsequent to any debt rating downgrades but may not be adjusted below 3.600% per annum. The Company may redeem the 2022 Notes at any time prior to February 15, 2022 at the greater of par or a price based on the applicable treasury rate plus 25 basis points. The Company may redeem the 2022 Notes at any time after February 15, 2022 at a price equal to par, plus accrued interest. On November 22, 2013, the Company issued $250.0 million of aggregate principal amount of unsecured notes due May 22, 2019 (“2019 Notes”). The 2019 Notes were repaid in May 2019 using proceeds from the Speedpay divestiture (see Note 5), commercial paper, and cash, including cash generated from operations. On December 10, 2012, the Company issued $500.0 million of aggregate principal amount of unsecured notes due December 10, 2017 (“2017 Notes”). In December 2017, the 2017 Notes matured and were repaid. On August 22, 2011, the Company issued $400.0 million of aggregate principal amount of unsecured notes due August 22, 2018 (“2018 Notes”). In August 2018, the 2018 Notes matured and were repaid. On June 21, 2010, the Company issued $250.0 million of aggregate principal amount of unsecured notes due June 21, 2040 (“2040 Notes”). Interest with respect to the 2040 Notes is payable semi-annually on June 21 and December 21 each year based on the fixed per annum rate of 6.200%. The Company may redeem the 2040 Notes at any time prior to maturity at the greater of par or a price based on the applicable treasury rate plus 30 basis points. On March 30, 2010, the Company exchanged $303.7 million of aggregate principal amount of unsecured notes due November 17, 2011 for the 2020 Notes. Interest with respect to the 2020 Notes is payable semi-annually on April 1 and October 1 each year based on the fixed per annum rate of 5.253%. In connection with the exchange, note holders were given a 7% premium ($21.2 million), which approximated market value at the exchange date, as additional principal. As this transaction was accounted for as a debt modification, this premium was not charged to expense. Rather, the premium, along with the offsetting hedge accounting adjustments, was accreted into Interest expense over the life of the notes. On November 18, 2019, the Company announced a cash tender offer on the Company’s outstanding 2020 Notes. On November 25, 2019, the Company purchased the principal amount of $56.1 million, plus accrued interest, pursuant to the tender offer. On December 27, 2019, the Company redeemed the remaining principal amount of $268.8 million, plus accrued interest. The total premium paid to redeem the 2020 Notes was $3.1 million. On November 17, 2006, the Company issued $500.0 million of aggregate principal amount of unsecured notes due November 17, 2036 (“2036 Notes”). Interest with respect to the 2036 Notes is payable semi-annually on May 17 and November 17 each year based on the fixed per annum rate of 6.200%. The Company may redeem the 2036 Notes at any time prior to maturity at the greater of par or a price based on the applicable treasury rate plus 25 basis points. The Revolving Credit Facility and Term Loan Facility contain covenants, subject to certain exceptions, that, among other things, limit or restrict the Company’s ability to sell or transfer assets or merge or consolidate with another company, grant certain types of security interests, incur certain types of liens, impose restrictions on subsidiary dividends, enter into sale and leaseback transactions, incur certain subsidiary level indebtedness, or use proceeds in violation of anti-corruption or anti-money laundering laws. The Company’s notes are subject to similar covenants except that only the 2036 Notes contain covenants limiting or restricting subsidiary indebtedness and none of the Company’s notes are subject to a covenant that limits the Company’s ability to impose restrictions on subsidiary dividends. Certain of the Company’s notes (including the 2022 2023 2025 2040 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation Plans | |
Stock-Based Compensation Plans | 17. Stock-Based Compensation Plans The Western Union Company 2006 Long-Term Incentive Plan and 2015 Long-Term Incentive Plan The Western Union Company 2015 Long-Term Incentive Plan (“2015 LTIP”), approved on May 15, 2015, provides for the granting of stock options, restricted stock awards and units, unrestricted stock awards and units, and other equity-based awards to employees and non-employee directors of the Company. Prior to this, equity-based awards were granted out of the 2006 Long-Term Incentive Plan (“2006 LTIP”). Shares available for grant under the 2015 LTIP were 23.8 million as of December 31, 2019. Options granted under the 2015 LTIP and the 2006 LTIP are issued with exercise prices equal to the fair market value of Western Union common stock on the grant date, have 10-year vest four Restricted stock unit grants typically vest four The compensation committee of the Company’s Board of Directors has granted the Company’s executives and certain other key employees, excluding the CEO, long-term incentive awards under the 2015 LTIP, which consisted of 50% Financial PSUs (as defined below), 30% restricted stock unit awards, and 20% TSR PSUs (as defined below) in 2019 and 2018. The CEO received long-term incentive awards under the 2015 LTIP consisting of 50% Financial PSUs, 20% TSR PSUs, 20% stock option awards, and 10% restricted stock unit awards in 2019 and 2018. The compensation committee granted Senior Vice Presidents of the Company awards under the 2015 LTIP, which consisted of 50% Financial PSUs and 50% restricted stock unit awards in 2019 and 2018. The compensation committee granted the remaining non-executive employees of the Company participating in the 2015 LTIP (other than those non-executive employees receiving the performance-based restricted stock units described above) annual equity grants consisting solely of restricted stock unit awards in 2019 and 2018. The performance-based restricted stock units granted to the Company’s executives in 2019 are restricted stock units and consist of two separate awards. The first award consists of performance-based restricted stock units, which require the Company to meet certain financial objectives over a three-year cumulative performance period (2019 through 2021) (“Financial PSUs”). Beginning with awards granted in February 2019, Financial PSUs will accrue dividend equivalents, with dividend equivalents paid in cash to the extent that the underlying shares vest. The second award consists of performance-based restricted stock units with a market condition tied to the Company’s total shareholder return in relation to the S&P 500 Index as calculated over a three-year performance period (2019 through 2021) (“TSR PSUs”). Both of these awards The Company has also granted deferred stock units out of the 2015 LTIP to the non-employee directors of the Company. Since deferred stock units vest immediately, compensation expense is recognized on the date of grant based on the fair value of the awards when granted. These awards may be settled immediately unless the participant elects to defer the receipt of common shares under the applicable plan rules. Stock Option Activity A summary of stock option activity for the year ended December 31, 2019 was as follows (options and aggregate intrinsic value in millions): Weighted-Average Remaining Aggregate Weighted-Average Contractual Term Intrinsic Options Exercise Price (Years) Value Outstanding as of January 1 6.2 $ 17.63 Granted 0.6 $ 17.68 Exercised (2.2) $ 16.26 Cancelled/forfeited (0.1) $ 18.49 Outstanding as of December 31 4.5 $ 18.31 5.2 $ 37.9 Options exercisable as of December 31 3.3 $ 18.17 4.1 $ 28.6 The Company received $36.7 million, $10.1 million, and $13.0 million in cash proceeds related to the exercise of stock options during the years ended December 31, 2019, 2018, and 2017, respectively. Upon the exercise of stock options, shares of common stock are issued from authorized common shares. The Company realized total tax benefits during the years ended December 31, 2019, 2018, and 2017 from stock option exercises of $2.4 million, $0.6 million, and $1.3 million, respectively. The total intrinsic value of stock options exercised during the years ended December 31, 2019, 2018, and 2017 was $11.6 million, $3.1 million, and $4.0 million, respectively. Restricted Stock Activity A summary of activity for restricted stock units and performance-based restricted stock units for the year ended December 31, 2019 was as follows (units in millions): Weighted-Average Units Grant-Date Fair Value Non-vested as of January 1 7.1 $ 17.69 Granted 3.7 $ 18.01 Vested (2.2) $ 17.55 Forfeited (1.5) $ 17.58 Non-vested as of December 31 7.1 $ 17.92 Stock-Based Compensation Expense The following table sets forth the total impact on earnings for stock-based compensation expense recognized in the Consolidated Statements of Income/(Loss) resulting from stock options, restricted stock units, performance-based restricted stock units and deferred stock units for the years ended December 31, 2019, 2018, and 2017 (in millions, except per share data): Year Ended December 31, 2019 2018 2017 Stock-based compensation expense $ (48.9) $ (47.7) $ (43.9) Income tax benefit from stock-based compensation expense 8.5 8.3 12.8 Net income/(loss) impact $ (40.4) $ (39.4) $ (31.1) Earnings/(loss) per share impact: Basic and diluted $ (0.09) $ (0.09) $ (0.07) As of December 31, 2019, there was $1.3 million of total unrecognized compensation cost, net of assumed forfeitures, related to non-vested stock options, which is expected to be recognized over a weighted-average period of 2.6 years, and there was $55.6 million of total unrecognized compensation cost, net of assumed forfeitures, related to non-vested restricted stock units and performance-based restricted stock units, which is expected to be recognized over a weighted-average period of 2.1 years. Fair Value Assumptions The Company used the following assumptions for the Black-Scholes option pricing model to determine the value of Western Union options granted: Year Ended December 31, 2019 2018 2017 Stock options granted: Weighted-average risk-free interest rate 2.5 % 2.8 % 2.1 % Weighted-average dividend yield 4.2 % 3.9 % 3.5 % Volatility 22.8 % 26.3 % 24.7 % Expected term (in years) 7.05 6.05 6.05 Weighted-average grant date fair value $ 2.56 $ 3.66 $ 3.39 Risk-free interest rate - Expected dividend yield - Expected volatility - Expected term - The assumptions used to calculate the fair value of options granted are evaluated and revised, as necessary, to reflect market conditions and the Company’s historical experience and future expectations. The calculated fair value is recognized as compensation cost in the Company’s consolidated financial statements over the requisite service period of the entire award. Compensation cost is recognized only for those options expected to vest, with forfeitures estimated at the date of grant and evaluated and adjusted periodically to reflect the Company’s historical experience and future expectations. Any change in the forfeiture assumption is accounted for as a change in estimate, with the cumulative effect of the change on periods previously reported being reflected in the consolidated financial statements of the period in which the change is made. |
Segments
Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segments | |
Segments | 18. Segments As further described in Note 1, the Company classifies its business into two segments: Consumer-to-Consumer and Business Solutions. Operating segments are defined as components of an enterprise that engage in business activities, about which separate financial information is available that is evaluated regularly by the Company’s CODM in allocating resources and assessing performance. The Consumer-to-Consumer operating segment facilitates money transfers between two consumers. The Company’s multi-currency money transfer service is provided through one interconnected global network where a money transfer can be sent from one location to another, around the world. The segment includes five geographic regions whose functions are primarily related to generating, managing, and maintaining agent relationships and localized marketing activities. The Company includes westernunion.com in its regions. By means of common processes and systems, these regions, including westernunion.com, create an interconnected network for consumer transactions, thereby constituting one global Consumer-to-Consumer money transfer business and one operating segment. The Business Solutions operating segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises, and other organizations and individuals. All businesses and other services that have not been classified in the above segments are reported as Other, which primarily includes the Company’s cash-based and electronic-based bill payment services which facilitate payments from consumers to businesses and other organizations. In May 2019, the Company sold a substantial majority of its United States based electronic bill payments services, as discussed in Note 5. The Company’s money order and other services are also included in Other. The Company’s segments are reviewed separately below because each segment represents a strategic business unit that offers different products and serves different markets. The business segment measurements provided to, and evaluated by, the Company’s CODM are computed in accordance with the following principles: ● The accounting policies of the segments are the same as those described in the summary of significant accounting policies. ● Corporate costs, including stock-based compensation and other overhead, are allocated to the segments primarily based on a percentage of the segments’ revenue compared to total revenue. ● As described in Note 4, on August 1, 2019, the Company’s Board of Directors approved an overall plan to change the Company’s operating model and improve its business processes and cost structure by reducing its headcount and consolidating various facilities. For the year ended December 31, 2019, the Company incurred $115.5 million related to this plan. While certain of these expenses may be identifiable to the Company’s segments, primarily the Company’s Consumer-to-Consumer segment, the expenses are not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As described in Note 5, during the year ended December 31, 2017, the Company recognized a goodwill impairment charge of $464.0 million related to its Business Solutions reporting unit. While the impairment was identifiable to the Business Solutions segment, it was not allocated to the segment, as it was not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As described in Note 6, during the year ended December 31, 2017, the Company incurred $60.0 million of expenses related to the NYDFS Consent Order and $8.0 million of expenses related to the Joint Settlement Agreements. While these expenses were identifiable to the Company’s Consumer-to-Consumer segment, they were not allocated to the segment, as they were not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As of December 31, 2017, expenses associated with the WU Way initiative were effectively complete. The Company incurred expenses related to the WU Way of $94.4 million during the year ended December 31, 2017. While certain items related to the initiative were identifiable to the Company’s segments, they were not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. For additional information on this business transformation initiative, see Note 4. ● The CODM does not review total assets by segment for purposes of assessing segment performance and allocating resources. As such, the disclosure of total assets by segment has not been included below. ● All items not included in operating income are excluded from the segments. The following tables present the Company’s segment results for the years ended December 31, 2019, 2018, and 2017 (in millions): Year Ended December 31, 2019 2018 2017 Revenues: Consumer-to-Consumer $ 4,407.8 $ 4,453.6 $ 4,354.5 Business Solutions 388.8 386.8 383.9 Other (a) 495.5 749.5 785.9 Total consolidated revenues $ 5,292.1 $ 5,589.9 $ 5,524.3 Operating income: Consumer-to-Consumer $ 975.4 $ 1,048.2 $ 1,004.2 Business Solutions 46.8 23.4 13.8 Other (a) 27.3 50.5 84.2 Total segment operating income 1,049.5 1,122.1 1,102.2 Goodwill impairment charge (Note 5) — — (464.0) NYDFS Consent Order (Note 6) — — (60.0) Joint Settlement Agreements (Note 6) — — (8.0) Restructuring-related expenses and business transformation expenses (Note 4) (115.5) — (94.4) Total consolidated operating income $ 934.0 $ 1,122.1 $ 475.8 (a) Other primarily consists of the Company’s cash-based and electronic-based bill payment services which facilitate payments from consumers to businesses and other organizations. In May 2019, the Company sold a substantial majority of its United States based electronic bill payments services, as discussed in Note 5. Speedpay revenues included in the Company’s results were $125.4 million, $352.0 million, and $368.3 million for the years ended December 31, 2019, 2018, and 2017, respectively. Speedpay direct operating expenses were $98.2 million, $251.2 million, and $246.0 million for the years ended December 31, 2019, 2018, and 2017, respectively. Paymap revenues included in the Company’s results were $5.3 million, $16.2 million, and $19.0 million for the years ended December 31, 2019, 2018, and 2017, respectively. Paymap direct operating expenses were $2.2 million, $6.7 million, and $6.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. Year Ended December 31, 2019 2018 2017 Depreciation and amortization: Consumer-to-Consumer $ 194.5 $ 189.9 $ 183.0 Business Solutions 39.6 41.9 42.5 Other 23.6 32.9 37.4 Total consolidated depreciation and amortization $ 257.7 $ 264.7 $ 262.9 Capital expenditures: Consumer-to-Consumer $ 97.0 $ 273.8 $ 120.2 Business Solutions 7.7 11.9 8.8 Other 23.0 53.3 48.1 Total capital expenditures $ 127.7 $ 339.0 $ 177.1 The geographic split of revenue below for the Consumer-to-Consumer and Business Solutions segments and Other is based upon the country where the transaction is initiated with 100% of the revenue allocated to that country. Long-lived assets, consisting of property and equipment, net, are presented based upon the location of the assets. Based on the method used to attribute revenue between countries described in the paragraph above, each individual country outside the United States accounted for less than 10% of consolidated revenue for the years ended December 31, 2019, 2018, and 2017, respectively. In addition, each individual agent or Business Solutions customer accounted for less than 10% of consolidated revenue during these periods. Information concerning principal geographic areas was as follows (in millions): Year Ended December 31, 2019 2018 2017 Revenue: United States $ 1,896.1 $ 2,126.2 $ 2,159.0 International 3,396.0 3,463.7 3,365.3 Total $ 5,292.1 $ 5,589.9 $ 5,524.3 Long-lived assets: United States (a) $ 173.7 $ 207.4 $ 156.8 International 62.5 63.0 57.4 Total $ 236.2 $ 270.4 $ 214.2 (a) Assets held for sale of $49.3 million, which primarily consists of the Company’s former headquarters, are included in Other assets as of December 31, 2019 in the Company’s Consolidated Balance Sheets. |
Quarterly Financial Information
Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information (Unaudited) | |
Quarterly Financial Information (Unaudited) | 19. Quarterly Financial Information (Unaudited) Summarized quarterly results for the years ended December 31, 2019 and 2018 were as follows (in millions, except per share data): Year Ended December 31, 2019 by Quarter: Q1 Q2 Q3 Q4 2019 Revenues $ 1,337.0 $ 1,340.5 $ 1,306.9 $ 1,307.7 $ 5,292.1 Expenses (a) 1,085.8 1,081.6 1,109.5 1,081.2 4,358.1 Operating income 251.2 258.9 197.4 226.5 934.0 Other income/(expense), net (b) (35.1) 486.7 (35.2) (29.0) 387.4 Income before income taxes 216.1 745.6 162.2 197.5 1,321.4 Provision for income taxes 43.0 130.8 27.2 62.1 263.1 Net income $ 173.1 $ 614.8 $ 135.0 $ 135.4 $ 1,058.3 Earnings per share: Basic $ 0.40 $ 1.43 $ 0.32 $ 0.32 $ 2.47 Diluted $ 0.39 $ 1.42 $ 0.32 $ 0.32 $ 2.46 Weighted-average shares outstanding: Basic 437.7 430.0 423.3 419.5 427.6 Diluted 439.9 432.3 426.8 424.7 430.9 Year Ended December 31, 2018 by Quarter: Q1 Q2 Q3 Q4 2018 Revenues $ 1,389.4 $ 1,411.1 $ 1,387.8 $ 1,401.6 $ 5,589.9 Expenses 1,124.5 1,127.5 1,085.2 1,130.6 4,467.8 Operating income 264.9 283.6 302.6 271.0 1,122.1 Other income/(expense), net (30.4) (28.1) (36.2) (36.0) (130.7) Income before income taxes 234.5 255.5 266.4 235.0 991.4 Provision for income taxes (c) 20.9 37.9 57.8 22.9 139.5 Net income $ 213.6 $ 217.6 $ 208.6 $ 212.1 $ 851.9 Earnings per share: Basic $ 0.46 $ 0.48 $ 0.47 $ 0.48 $ 1.89 Diluted $ 0.46 $ 0.47 $ 0.46 $ 0.48 $ 1.87 Weighted-average shares outstanding: Basic 460.3 457.2 446.8 442.9 451.8 Diluted 463.6 459.6 449.0 445.4 454.4 (a) Includes $7.4 million, $91.5 million, and $16.6 million in the second, third, and fourth quarters, respectively, of restructuring-related expenses. For more information, see Note 4. (b) Includes a gain on the sale of Speedpay of approximately $523 million in the second quarter. For more information, see Note 5. (c) Includes $(6.0) million, $(6.2) million, $26.6 million, and $8.1 million in the first, second, third, and fourth quarters, respectively, of adjustments related to the Tax Act, as further described in Note 11. |
Schedule I - Condensed Financia
Schedule I - Condensed Financial Information of the Registrant | 12 Months Ended |
Dec. 31, 2019 | |
CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT | |
Schedule I - Condensed Financial Information of the Registrant | THE WESTERN UNION COMPANY SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT The following lists the condensed financial information for the parent company as of December 31, 2019 and 2018 and Condensed Statements of Income/(Loss) and Comprehensive Income/(Loss) and Condensed Statements of Cash Flows for each of the three years in the period ended December 31, 2019. THE WESTERN UNION COMPANY CONDENSED BALANCE SHEETS (PARENT COMPANY ONLY) (in millions, except per share amounts) December 31, 2019 2018 Assets Cash and cash equivalents $ 4.0 $ 0.2 Property and equipment, net of accumulated depreciation of $24.8 and $33.5, respectively 68.5 107.3 Other assets (Note 6) 147.3 48.6 Investment in subsidiaries 5,886.9 5,665.5 Total assets $ 6,106.7 $ 5,821.6 Liabilities and stockholders’ deficit Liabilities: Accounts payable and accrued liabilities $ 58.0 $ 100.2 Income taxes payable 680.4 727.0 Payable to subsidiaries, net 2,070.1 1,869.6 Borrowings 3,229.3 3,433.7 Other liabilities (Note 6) 108.4 0.9 Total liabilities 6,146.2 6,131.4 Stockholders’ deficit: Preferred stock, $1.00 par value; 10 shares authorized; no shares issued — — Common stock, $0.01 par value; 2,000 shares authorized; 418.0 shares and 441.2 shares issued and outstanding as of December 31, 2019 2018 4.2 4.4 Capital surplus 841.2 755.6 Accumulated deficit (675.9) (838.8) Accumulated other comprehensive loss (209.0) (231.0) Total stockholders’ deficit (39.5) (309.8) Total liabilities and stockholders’ deficit $ 6,106.7 $ 5,821.6 See Notes to Condensed Financial Statements. THE WESTERN UNION COMPANY CONDENSED STATEMENTS OF INCOME/(LOSS) AND COMPREHENSIVE INCOME/(LOSS) (PARENT COMPANY ONLY) (in millions) For the Years Ended December 31, 2019 2018 2017 Revenues $ — $ — $ — Expenses — — — Operating income — — — Gain on divestitures of businesses (Note 4) 524.6 — — Interest income — — — Interest expense (181.5) (197.6) (177.0) Other income/(expense) 2.7 (1.0) (0.6) Income/(loss) before equity in earnings/(losses) of affiliates and income taxes 345.8 (198.6) (177.6) Equity in earnings/(losses) of affiliates, net of tax 827.3 997.2 (436.1) Income tax (expense)/benefit (114.8) 53.3 56.6 Net income/(loss) 1,058.3 851.9 (557.1) Other comprehensive income, net of tax 0.2 1.6 2.1 Other comprehensive income/(loss) of affiliates, net of tax 21.8 26.7 (67.2) Comprehensive income/(loss) $ 1,080.3 $ 880.2 $ (622.2) See Notes to Condensed Financial Statements. THE WESTERN UNION COMPANY CONDENSED STATEMENTS OF CASH FLOWS (PARENT COMPANY ONLY) (in millions) For the Years Ended December 31, 2019 2018 2017 Cash flows from operating activities Net cash provided by/(used in) operating activities $ 103.1 $ 539.1 $ (605.0) Cash flows from investing activities Purchases of property and equipment and other (9.9) (78.9) (0.7) Proceeds from divestitures of businesses, net of cash divested (Note 4) 711.7 — — Distributions received from/(capital contributed to) subsidiaries, net 74.0 (456.3) 307.3 Net cash provided by/(used in) investing activities 775.8 (535.2) 306.6 Cash flows from financing activities Advances from subsidiaries, net 194.0 345.5 868.3 Net proceeds from commercial paper 120.0 125.0 — Net proceeds from issuance of borrowings 495.9 685.4 746.2 Principal payments on borrowings (824.9) (414.4) (500.0) Proceeds from exercise of options and other 33.3 7.9 13.0 Cash dividends paid (340.8) (341.7) (325.6) Common stock repurchased (552.6) (412.4) (502.8) Net cash provided by/(used in) financing activities (875.1) (4.7) 299.1 Net change in cash and cash equivalents 3.8 (0.8) 0.7 Cash and cash equivalents at beginning of year 0.2 1.0 0.3 Cash and cash equivalents at end of year $ 4.0 $ 0.2 $ 1.0 Supplemental cash flow information: Non-cash investing activity, capital contribution to subsidiary (Note 3) $ — $ — $ 916.0 Non-cash financing activity, distribution of note from subsidiary (Note 3) $ — $ 2,256.1 $ 80.3 Cash paid for lease liabilities $ 17.0 $ — $ — Non-cash lease liabilities arising from obtaining right-of-use assets (Note 6) $ 124.8 $ — $ — See Notes to Condensed Financial Statements. CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT THE WESTERN UNION COMPANY NOTES TO CONDENSED FINANCIAL STATEMENTS 1. Basis of Presentation The Western Union Company (the “Parent”) is a holding company that conducts substantially all of its business operations through its subsidiaries. Under a parent company only presentation, the Parent’s investments in its consolidated subsidiaries are presented under the equity method of accounting, and the condensed financial statements do not present the financial statements of the Parent and its subsidiaries on a consolidated basis. These financial statements should be read in conjunction with The Western Union Company’s consolidated financial statements. 2. Restricted Net Assets Certain assets of the Parent’s subsidiaries totaling approximately $610 million constitute restricted net assets, as there are legal or regulatory limitations on transferring such assets outside of the countries where the respective assets are located. Additionally, certain of the Parent’s subsidiaries must meet minimum capital requirements in some countries in order to maintain operating licenses. 3. Related Party Transactions The Parent enters into contracts with third-party vendors on behalf of its subsidiaries. Because the Parent is a holding company, as noted above, these corporate costs are incurred by the Parent, and the expenses are then allocated to its subsidiaries based primarily on the subsidiaries’ percentage of revenues compared to total revenues. All transactions described below are with subsidiaries of the Parent. The Parent has issued multiple promissory notes payable to its 100% owned subsidiary, First Financial Management Corporation (“FFMC”) in exchange for funds distributed to the Parent. All notes pay interest at a fixed rate, may be repaid at any time without penalty, and are included within Payable to subsidiaries, net in the Condensed Balance Sheets. These promissory notes are as follows: Amount Interest Rate Date Issued (in millions) Due Date (per annum) March 1, 2018 (a) $ 88.5 November 30, 2020 1.96 % April 1, 2018 (a) $ 273.0 December 31, 2020 2.12 % June 1, 2018 (a) $ 229.6 February 28, 2021 2.34 % October 1, 2019 (a) $ 162.8 June 30, 2022 1.69 % December 1, 2019 (a) $ 67.4 August 31, 2022 1.61 % (a) This note refinanced a note originally issued on a prior date. On November 8, 2015, the Parent entered into a Revolving Credit Facility agreement (the “Revolver”) with its 100% owned subsidiary RII Holdings, Inc., which expires on November 8, 2035, providing for unsecured financing facilities in an aggregate amount of $3.0 billion. As of December 31, 2019 and 2018, borrowings outstanding under the Revolver were $993.6 million and $914.6 million, respectively. The interest rate applicable for outstanding borrowings under the Revolver is the six-month LIBOR rate set on the first day of the calendar year, which was 1.91% and 2.87% as of December 31, 2019 and 2018, respectively. Outstanding borrowings under the Revolver are included within Payable to subsidiaries, net in the Condensed Balance Sheets as of December 31, 2019 and 2018. CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT THE WESTERN UNION COMPANY NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued) The Parent files its United States federal consolidated income tax return on its and certain of its affiliates’ behalf. Accordingly, the Parent has recorded income taxes payable on behalf of its subsidiaries, and these income taxes payable were significant due to the enactment of the Tax Act into United States law. During 2017, the Parent made a non-cash capital contribution of $916.0 million to a subsidiary that was subject to the taxation of certain previously undistributed earnings of its foreign subsidiaries under the Tax Act, and this contribution is reflected as a non-cash investing activity in the Condensed Statements of Cash Flows. The Parent agreed to fund certain payments related to the Joint Settlement Agreements on behalf of its subsidiaries of $591.0 million. As of and during the year ended December 31, 2017, these amounts were paid and are reflected in the Parent’s operating activities in the Condensed Statements of Cash Flows. On November 30, 2017, FFMC distributed a promissory note owed by the Parent in the amount of $80.3 million. This distribution to the Parent is reflected as a non-cash financing activity in the Condensed Statements of Cash Flows for the year ended December 31, 2017. Excess cash generated from operations of the Parent’s subsidiaries that is not required to meet certain regulatory requirements may be periodically distributed to the Parent in the form of a distribution, although the amounts of such distributions may vary from year to year. The Parent files a consolidated United States federal income tax return and also a number of consolidated state income tax returns on behalf of its subsidiaries. In these circumstances, the Parent is responsible for remitting income tax payments on behalf of the consolidated group. The Parent’s provision for income taxes has been computed as if it were a separate tax-paying entity. 4. Divestitures of Businesses On February 28, 2019, the Parent entered into an agreement with ACI to sell its United States electronic bill payments business known as Speedpay. The Parent received approximately $750 million and recorded a pre-tax gain on the sale of approximately $523 million, which is included in Gain on divestitures of businesses in the Condensed Statements of Income/(Loss) and Comprehensive Income/(Loss), in the all-cash transaction that closed on May 9, 2019. On May 6, 2019, the Parent completed the sale of Paymap, which provides electronic mortgage bill payment services, for contingent consideration and immaterial cash proceeds received at closing. The Parent recorded an immaterial pre-tax gain related to this sale during 2019. 5. Commitments and Contingencies The Parent had approximately $110 million in outstanding letters of credit and bank guarantees as of December 31, 2019 with expiration dates through 2021. The letters of credit and bank guarantees are primarily held in connection with certain agent agreements. The Company expects to renew the letters of credit and bank guarantees prior to expiration in most circumstances. CONDENSED FINANCIAL INFORMATION OF THE REGISTRANT THE WESTERN UNION COMPANY NOTES TO CONDENSED FINANCIAL STATEMENTS (Continued) 6. Leases The Parent leases real properties primarily for use as administrative and sales offices. The Parent determines if a contract contains a lease arrangement at the inception of the contract. For leases in which the Parent is the lessee, leases are classified as either finance or operating, with classification affecting the pattern of expense recognition. Operating lease ROU assets are initially measured at the present value of lease payments over the lease term plus initial direct costs, if any. If a lease does not provide a discount rate and the rate cannot be readily determined, an incremental borrowing rate is used to determine the future lease payments. Lease and variable non-lease components within the Parent’s lease agreements are accounted for separately. The Parent has no material leases in which the Parent is the lessor. Substantially all of the Parent’s leasing arrangements are classified as operating leases, for which expense is recognized on a straight-line basis. As of December 31, 2019, the total ROU asset and lease liability were $66.5 million and $105.7 million, respectively, and were included in Other assets Other liabilities The Parent’s leases have remaining terms from less than 1 year to 11 years. Certain of these leases contain escalation provisions and/or renewal options, giving the Parent the right to extend the lease by up to 10 years. However, a substantial majority of these options are not reflected in the calculation of the ROU asset and lease liability due to uncertainty surrounding the likelihood of renewal. The following table summarizes the weighted-average lease term and discount rate for operating lease liabilities as of December 31, 2019: Weighted-average remaining lease term (in years) 10.5 Weighted-average discount rate 5.7 % The following table represents maturities of operating lease liabilities as of December 31, 2019 (in millions): Due within 1 year $ 12.9 Due after 1 year through 2 years 13.2 Due after 2 years through 3 years 13.5 Due after 3 years through 4 years 13.8 Due after 4 years through 5 years 14.2 Due after 5 years 74.5 Total lease payments 142.1 Less imputed interest (36.4) Total operating lease liabilities $ 105.7 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The financial statements in this Annual Report on Form 10-K are presented on a consolidated basis and include the accounts of the Company and its majority-owned subsidiaries. All significant intercompany transactions and accounts have been eliminated. Consistent with industry practice, the accompanying Consolidated Balance Sheets are unclassified due to the short-term nature of the Company’s settlement obligations contrasted with the Company’s ability to invest cash awaiting settlement in long-term investment securities. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates. |
Principles of Consolidation | Principles of Consolidation The Company consolidates financial results when it has a controlling financial interest in a subsidiary via voting rights or when it has both the power to direct the activities of an entity that most significantly impact the entity’s economic performance and the ability to absorb losses or the right to receive benefits of the entity that could potentially be significant to the entity. The Company utilizes the equity method of accounting when it is able to exercise significant influence over an entity’s operations, which generally occurs when the Company has an ownership interest between 20% and 50%. |
Earnings/(Loss) Per Share | Earnings/(Loss) Per Share The calculation of basic earnings/(loss) per share is computed by dividing net income/(loss) available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Outstanding options to purchase Western Union stock and unvested shares of restricted stock are excluded from basic shares outstanding. Diluted earnings/(loss) per share reflects the potential dilution that could occur if outstanding stock options at the presented dates are exercised and shares of restricted stock have vested, using the treasury stock method. The treasury stock method assumes proceeds from the exercise price of stock options and the unamortized compensation expense of options and restricted stock are available to acquire shares at an average market price throughout the period, and therefore, reduce the dilutive effect. For the years ended December 31, 2019, 2018, and 2017, there were 1.9 million, 2.6 million, and 2.8 million, respectively, of shares excluded from the diluted earnings/(loss) per share calculation under the treasury stock method, primarily due to outstanding options to purchase shares of Western Union stock, as their exercise prices were above the Company’s weighted-average share price during the periods and their effect was anti-dilutive. Due to the net loss for the year ended December 31, 2017, an additional 3.0 million shares have been excluded from diluted weighted-average shares outstanding, because the effect of including such shares would be anti-dilutive in the calculation of diluted loss per share. The following table provides the calculation of diluted weighted-average shares outstanding (in millions): Year Ended December 31, 2019 2018 2017 Basic weighted-average shares outstanding 427.6 451.8 467.9 Common stock equivalents 3.3 2.6 — Diluted weighted-average shares outstanding 430.9 454.4 467.9 |
Fair Value Measurements | Fair Value Measurements The Company determines the fair values of its assets and liabilities that are recognized or disclosed at fair value in accordance with the hierarchy described below. The fair values of the assets and liabilities held in the Company’s defined benefit plan trust (“Trust”) are recognized or disclosed utilizing the same hierarchy. The following three levels of inputs may be used to measure fair value: ● Level 1 - Quoted prices in active markets for identical assets or liabilities. ● Level 2 - Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For most of these assets, the Company utilizes pricing services that use multiple prices as inputs to determine daily market values. ● Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include items where the determination of fair value requires significant management judgment or estimation. The Company holds assets classified as Level 3 that are recognized and disclosed at fair value on a non-recurring basis related to the Company’s business combinations, where the values of the intangible assets and goodwill acquired in a purchase are derived utilizing one of the three recognized approaches: the market approach, the income approach, or the cost approach. In addition, the Trust has other investments that are valued at net asset value, which are not quoted on an active market; however, the unit price is based on underlying investments which are traded on an active market. Carrying amounts for many of the Company’s financial instruments, including cash and cash equivalents, settlement cash and cash equivalents, and settlement receivables and settlement obligations approximate fair value due to their short maturities. Available-for-sale investment securities and derivative financial instruments are carried at fair value and further discussed in Note 9. Fixed-rate notes are carried at their original issuance values and adjusted over time to accrete that value to par, except for portions of notes hedged by interest rate swap agreements as disclosed in Note 15. The fair values of fixed-rate notes are disclosed in Note 9 and are based on market quotations. The fair values of non-financial assets and liabilities related to the Company’s business combinations are disclosed in Note 5. The fair value of the assets in the Trust, which holds the assets for the Company’s defined benefit pension plan, is disclosed in Note 12. |
Business Combinations | Business Combinations The Company accounts for all business combinations where control over another entity is obtained using the acquisition method of accounting, which requires that most assets (both tangible and intangible), liabilities (including contingent consideration), and remaining noncontrolling interests be recognized at fair value at the date of acquisition. The excess of the purchase price over the fair value of assets less liabilities and noncontrolling interests is recognized as goodwill. Certain adjustments to the assessed fair values of the assets, liabilities, or noncontrolling interests made subsequent to the acquisition date, but within the measurement period, which is one year or less, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded within Net income. Any cost or equity method interest that the Company holds in the acquired company prior to the acquisition is remeasured to fair value at acquisition with a resulting gain or loss recognized within Other income, net for the difference between fair value and existing book value. Results of operations of the acquired company are included in the Company’s results from the date of the acquisition forward and include amortization expense arising from acquired intangible assets. The Company expenses all costs as incurred related to or involved with an acquisition in Selling, general, and administrative expenses. |
Cash and Cash Equivalents | Cash and Cash Equivalents Highly liquid investments (other than those included in settlement assets) with maturities of three months or less at the date of purchase (that are readily convertible to cash) are considered to be cash equivalents and are stated at cost, which approximates fair value. The Company maintains cash and cash equivalent balances, including a portion in money market funds, with a group of globally diversified banks and financial institutions. The Company limits the concentration of its cash and cash equivalents with any one institution and regularly reviews investment concentrations and credit worthiness of these institutions. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts The Company records an allowance for doubtful accounts when it is probable that the related receivable balance will not be collected based on its history of collection experience, known collection issues, such as agent suspensions and bankruptcies, consumer chargebacks and insufficient funds, and other matters the Company identifies in its routine collection monitoring. The allowance for doubtful accounts was $42.2 million and $47.7 million as of December 31, 2019 and 2018, respectively, and is recorded in the same balance sheet captions as the related receivable. During the years ended December 31, 2019, 2018, and 2017, the provision for doubtful accounts (bad debt expense) reflected in the Consolidated Statements of Income/(Loss) was $47.1 million, $43.9 million, and $60.6 million, respectively. |
Settlement Assets and Obligations | Settlement Assets and Obligations Settlement assets represent funds received or to be received from agents for unsettled money transfers, money orders, and consumer payments. The Company records corresponding settlement obligations relating to amounts payable under money transfers, money orders, and consumer payment service arrangements. Settlement assets and obligations also include amounts receivable from, and payable to, customers for the value of their cross-currency payment transactions related to the Business Solutions segment. Settlement assets consist of cash and cash equivalents, receivables from selling agents and Business Solutions customers, and investment securities. Cash received by Western Union agents generally becomes available to the Company within one week after initial receipt by the agent. Cash equivalents consist of short-term time deposits, commercial paper, and other highly liquid investments. Receivables from selling agents represent funds collected by such agents, but in transit to the Company. Western Union has a large and diverse agent base, thereby reducing the credit risk of the Company from any one agent. In addition, the Company performs ongoing credit evaluations of its agents’ financial condition and credit worthiness. See Note 8 for information concerning the Company’s investment securities. Receivables from Business Solutions customers arise from cross-currency payment transactions in the Business Solutions segment. Receivables occur when funds have been paid out to a beneficiary but not yet received from the customer. Aside from these receivables, the credit risk associated with spot foreign currency exchange contracts is largely mitigated, as in most cases the Company requires the receipt of funds from customers before releasing the associated cross-currency payment. Settlement obligations consist of money transfer, money order and payment service payables, and payables to agents. Money transfer payables represent amounts to be paid to transferees when they request their funds. Most agents typically settle with transferees first and then obtain reimbursement from the Company. Money order payables represent amounts not yet presented for payment. Payment service payables represent amounts to be paid to utility companies, auto finance companies, mortgage servicers, financial service providers, government agencies, and others. Due to the agent funding and settlement process, payables to agents represent amounts due to agents for money transfers that have been settled with transferees. Settlement assets and obligations consisted of the following (in millions): December 31, 2019 2018 Settlement assets: Cash and cash equivalents $ 368.2 $ 1,247.8 Receivables from selling agents and Business Solutions customers 1,230.1 1,355.4 Investment securities 1,698.4 1,210.6 Total settlement assets $ 3,296.7 $ 3,813.8 Settlement obligations: Money transfer, money order, and payment service payables $ 2,571.5 $ 2,793.6 Payables to agents 725.2 1,020.2 Total settlement obligations $ 3,296.7 $ 3,813.8 |
Property and Equipment | Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the lesser of the estimated life of the related assets (generally three furniture fixtures Property and equipment consisted of the following (in millions): December 31, 2019 2018 Equipment $ 591.4 $ 656.8 Leasehold improvements 159.2 158.6 Buildings 0.4 88.6 Furniture and fixtures 49.4 51.6 Land and improvements — 17.0 Projects in process 3.0 0.2 Total property and equipment, gross 803.4 972.8 Less accumulated depreciation (616.5) (702.4) Property and equipment, net (a) $ 186.9 $ 270.4 (a) At December 31, 2019, Property and equipment, net, excludes assets held for sale of $49.3 million, which primarily consists of the Company’s former headquarters, which was sold in January 2020, and land. These assets are included in Other assets in the Company’s Consolidated Balance Sheets. Amounts charged to expense for depreciation of property and equipment were $79.6 million, $76.9 million, and $77.1 million during the years ended December 31, 2019, 2018, and 2017, respectively. |
Goodwill | Goodwill Goodwill represents the excess of purchase price over the fair value of tangible and other intangible assets acquired, less liabilities assumed arising from business combinations. In the event a reporting unit’s carrying amount exceeds its fair value, the Company recognizes an impairment charge for the amount by which the carrying amount of the reporting unit exceeds its fair value. The Company’s annual impairment assessment did not identify any goodwill impairment during the years ended December 31, 2019 and 2018. For the year ended December 31, 2017, the Company recognized a goodwill impairment charge of $464.0 million related to its Business Solutions reporting unit, as disclosed in Note 5. |
Other Intangible Assets | Other Intangible Assets Other intangible assets primarily consist of contract costs (primarily amounts paid to agents in connection with establishing and renewing long-term contracts), acquired contracts, and software. Other intangible assets are amortized on a straight-line basis over the length of the contract or benefit periods. Included in the Consolidated Statements of Income/(Loss) is amortization expense of $178.1 million, $187.8 million, and $185.8 million for the years ended December 31, 2019, 2018, and 2017, respectively. The Company capitalizes initial payments for new and renewed agent contracts to the extent recoverable through future operations or penalties in the case of early termination. The Company’s accounting policy is to limit the amount of capitalized costs for a given contract to the lesser of the estimated future cash flows from the contract or the termination fees the Company would receive in the event of early termination of the contract. Acquired contracts include customer and contractual relationships and networks of subagents that are recognized in connection with the Company’s acquisitions. The Company purchases and develops software that is used in providing services and in performing administrative functions. Internal and external software development costs incurred that are directly related to the chosen design, development, and testing phases of the software are capitalized once the Company has completed all planning and analysis activities. Any other software development related costs are expensed as incurred. Capitalization of costs ceases when the product is available for general use. Software development costs and purchased software are generally amortized over a term of three The following table provides the components of other intangible assets (in millions): December 31, 2019 December 31, 2018 Weighted- Average Amortization Net of Net of Period Accumulated Accumulated (in years) Initial Cost Amortization Initial Cost Amortization Acquired contracts 11.5 $ 584.2 $ 124.1 $ 598.1 $ 171.2 Capitalized contract costs 6.2 510.3 271.7 536.5 318.9 Internal use software 3.8 281.2 54.7 447.3 80.6 Acquired trademarks 25.4 30.1 13.2 32.5 15.5 Other intangibles 4.3 19.4 — 19.4 — Projects in process (a) 31.2 31.2 12.0 12.0 Total other intangible assets 8.1 $ 1,456.4 $ 494.9 $ 1,645.8 $ 598.2 (a) Not applicable as the assets have not been placed in service. The estimated future aggregate amortization expense for existing other intangible assets as of December 31, 2019 is expected to be $146.6 million in 2020, $113.9 million in 2021, $75.9 million in 2022, $55.9 million in 2023, $38.6 million in 2024, and $32.8 million thereafter. Other intangible assets are reviewed for impairment on an annual basis or whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. In such reviews, estimated undiscounted cash flows associated with these assets or operations are compared with their carrying values to determine if a write-down to fair value (normally measured by the present value technique) is required. The Company recorded immaterial impairments related to other intangible assets during the years ended December 31, 2019, 2018, and 2017. |
Revenue Recognition | The Company’s revenues are primarily derived from consideration paid by customers to transfer money. These revenues vary by transaction based upon factors such as channel, send and receive locations, the principal amount sent, whether the money transfer involves different send and receive currencies, the difference between the exchange rate set by the Company to the customer and the rate available in the wholesale foreign exchange market, and speed of service, as applicable. The Company also offers several other services, including foreign exchange and payment services and other bill payment services, for which revenue is impacted by similar factors. For the substantial majority of the Company’s revenues, the Company acts as the principal in transactions and reports revenue on a gross basis, as the Company controls the service at all times prior to transfer to the customer, is primarily responsible for fulfilling the customer contracts, has the risk of loss, and has the ability to establish transaction prices. Revenue is recognized net of any taxes collected from customers, which are subsequently remitted to governmental authorities. |
Cost of Services | Cost of Services Cost of services primarily consists of agent commissions and expenses for call centers, settlement operations, and related information technology costs. Expenses within these functions include personnel, software, equipment, telecommunications, bank fees, depreciation, amortization, and other expenses incurred in connection with providing money transfer and other payment services. |
Advertising Costs | Advertising Costs Advertising costs are charged to operating expenses as incurred. Advertising costs for the years ended December 31, 2019, 2018, and 2017 were $209.1 million, $180.9 million, and $168.3 million, respectively. |
Income Taxes | Income Taxes The Company accounts for income taxes under the liability method, which requires that deferred tax assets and liabilities be determined based on the expected future income tax consequences of events that have been recognized in the consolidated financial statements. Deferred tax assets and liabilities are recognized based on temporary differences between the financial statement carrying amounts and tax bases of assets and liabilities using enacted tax rates in effect in the years in which the temporary differences are expected to reverse. The Company assesses the realizability of its deferred tax assets. A valuation allowance must be established when, based upon available evidence, it is more likely than not that all or a portion of the deferred tax assets will not be realized. The Company recognizes the tax benefits from uncertain tax positions only when it is more likely than not, based on the technical merits of the position, the tax position will be sustained upon examination, including the resolution of any related appeals or litigation. The tax benefits recognized in the consolidated financial statements from such a position are measured as the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate resolution. The Company accounts for the tax effects of global intangible low-taxed income as a component of income tax expense in the period the tax arises. |
Foreign Currency Translation | Foreign Currency Translation The United States dollar is the functional currency for substantially all of the Company’s businesses. Revenues and expenses are translated at average exchange rates prevailing during the period. Foreign currency denominated assets and liabilities for those businesses for which the local currency is the functional currency are translated into United States dollars based on exchange rates at the end of the year. The effects of foreign exchange gains and losses arising from the translation of assets and liabilities of these businesses are included as a component of Accumulated other comprehensive loss (“AOCL”) in the accompanying Consolidated Balance Sheets. Foreign currency denominated monetary assets and liabilities of businesses for which the United States dollar is the functional currency are remeasured based on exchange rates at the end of the period, and the resulting remeasurement gains and losses are recognized in Net income/(loss). Non-monetary assets and liabilities of these operations are remeasured at historical rates in effect when the asset was recognized or the liability was incurred. |
Derivatives | Derivatives The Company uses derivatives to (i) minimize its exposures related to changes in foreign currency exchange rates and interest rates and (ii) facilitate cross-currency Business Solutions payments by writing derivatives to customers. The Company recognizes all derivatives in the Other assets and Other liabilities captions in the accompanying Consolidated Balance Sheets at their fair value. All cash flows associated with derivatives are included in Cash flows from operating activities in the Consolidated Statements of Cash Flows. Certain of the Company’s derivative arrangements are designated as either cash flow hedges or fair value hedges at the time of inception, and others are not designated as accounting hedges. ● Cash flow hedges – Cash flow hedges consist of foreign currency hedging of forecasted revenues, as well as hedges of the forecasted issuance of fixed-rate debt. Derivative fair value changes that are captured in AOCL are reclassified to earnings in the same period the hedged item affects earnings when the instrument is effective in offsetting the change in cash flows attributable to the risk being hedged. On January 1, 2018, the Company early adopted an accounting pronouncement related to hedging activities. As a result of the new accounting pronouncement, for foreign currency cash flow hedges entered into on or after January 1, 2018, the Company excludes time value from the assessment of effectiveness, and the initial value of the excluded components is amortized into Revenues within the Consolidated Statements of Income/(Loss). For foreign currency cash flow hedges entered into before January 1, 2018, all changes in the fair value of the excluded components are recognized immediately in Revenues for the years ended December 31, 2019 and 2018. For the year ended December 31, 2017, the changes in fair value of the excluded components were recognized immediately within the Consolidated Statements of Income/(Loss) and are included in Other income, net. ● Fair value hedges - Fair value hedges consist of hedges of fixed-rate debt, through interest rate swaps. Changes in the fair value of derivatives that are designated as fair value hedges of fixed-rate debt are recorded in Interest expense. The offsetting change in value of the related debt instrument attributable to changes in the benchmark interest rate is also recorded in Interest expense. At December 31, 2019, there were no fair value hedges outstanding. ● Undesignated - Derivative contracts entered into to reduce the foreign exchange variability related to (i) money transfer settlement assets and obligations, generally with maturities from a few days up to one month , and (ii) certain foreign currency denominated cash and other asset and liability positions, typically with maturities of less than one year at inception, are not designated as hedges for accounting purposes and changes in their fair value are included in Selling, general, and administrative. The Company is also exposed to risk from derivative contracts written to its customers arising from its cross-currency Business Solutions payments operations. The duration of these derivative contracts at inception is generally less than one year . The Company aggregates its Business Solutions payments foreign currency exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties (economic hedge contracts) as part of a broader foreign currency portfolio, including significant spot exchanges of currency in addition to forwards and options. The changes in fair value related to these contracts are recorded in Revenues. The fair value of the Company’s derivatives is derived from standardized models that use market-based inputs (e.g., forward prices for foreign currency). The details of each designated hedging relationship are formally documented at the inception of the arrangement, including the risk management objective, hedging strategy, hedged item, specific risks being hedged, the derivative instrument, and how effectiveness is being assessed. The derivative must be highly effective in offsetting the changes in cash flows or fair value of the hedged item, and effectiveness is evaluated quarterly on a retrospective and prospective basis. |
Legal Contingencies | Legal Contingencies The Company is a party to certain legal and regulatory proceedings with respect to a variety of matters. The Company records an accrual for these contingencies to the extent that a loss is both probable and reasonably estimable. If some amount within a range of loss appears to be a better estimate than other amounts within the range, that amount is accrued. When no amount within a range of loss appears to be a better estimate than any other amount, the lowest amount in the range is accrued. |
Stock-Based Compensation | Stock-Based Compensation The Company currently has a stock-based compensation plan that provides for grants of Western Union stock options, restricted stock awards, and restricted and unrestricted stock units to employees and non-employee directors of the Company. All stock-based compensation to employees is required to be measured at fair value and expensed over the requisite service period. The Company recognizes compensation expense on awards on a straight-line basis over the requisite service period for the entire award, with an estimate for forfeitures. Refer to Note 17 for additional discussion regarding details of the Company’s stock-based compensation plans. |
Severance and Other Related Expenses | Severance and Other Related Expenses The Company records severance-related expenses once they are both probable and estimable in accordance with the provisions of the applicable accounting guidance for severance provided under an ongoing benefit arrangement. One-time involuntary benefit arrangements and other costs are generally recognized when the liability is incurred. The Company also evaluates impairment issues associated with restructuring and other activities when the carrying amount of the related assets may not be fully recoverable, in accordance with the appropriate accounting guidance. |
Recently Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements On January 1, 2019, the Company adopted a new accounting standard, as amended, that requires the Company to record assets and liabilities on the balance sheet for lease-related rights and obligations and disclose key information about its leasing arrangements. The Company elected the effective date method, utilized the modified retrospective On January 1, 2018, the Company adopted a new accounting standard, as amended, regarding revenue from contracts with customers using the modified retrospective approach. This standard provides guidance on recognizing revenue, including a five-step model to determine when revenue recognition is appropriate. The adoption of this standard did not have a material impact on the Company’s financial position and results of operations. Refer to Note 3 for the related additional disclosures. On January 1, 2018, the Company retrospectively adopted an accounting pronouncement that requires restricted cash, which is recorded in Other assets in the Company’s Consolidated Balance Sheets, to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period amounts shown on the statements of cash flows. The adoption of this standard had an immaterial impact on the Company’s historical operating cash flows within the Consolidated Statements of Cash Flows. In the first quarter of 2018, the Company adopted a new accounting pronouncement that provides entities the option to reclassify tax effects included within AOCL as a result of the United States tax reform legislation enacted in December 2017 (the “Tax Act”) to retained earnings. The adoption of this standard resulted in an increase to AOCL and a decrease to Accumulated deficit in the Consolidated Balance Sheets of $31.4 million, which represents the tax effects of the lower federal tax rate on unrealized gains/(losses) on investment securities, hedging activities, and adjustments related to the Company’s defined benefit pension plan, in addition to the release of deferred taxes accrued on undistributed earnings of one of the Company’s subsidiaries that are no longer owed under the Tax Act. The Company will continue to release tax effects remaining in AOCL into income as the individual units of account are sold or otherwise extinguished. Refer to Note 14 for additional information. Accounting Pronouncements Not Yet Adopted In June 2016, the Financial Accounting Standards Board issued a new accounting pronouncement regarding credit losses for financial instruments. The new standard requires entities to measure expected credit losses for certain financial assets held at the reporting date using a current expected credit loss model, which is based on historical experience, adjusted for current conditions and reasonable and supportable forecasts. Additionally, the standard requires certain credit losses relating to investment securities classified as available-for-sale to be recorded through an allowance for credit losses. The Company is required to adopt the new standard on January 1, 2020. The Company has completed its analysis of the standard and has concluded that the adoption of the standard will not have a material impact on the Company’s financial statements. |
Investment Securities | Investment securities included in Settlement assets in the Company’s Consolidated Balance Sheets consist primarily of highly-rated state and municipal debt securities, including fixed-rate term notes and variable-rate demand notes. Variable-rate demand note securities can be put (sold at par), typically on a daily basis with settlement periods ranging from the same day to one week, but have varying maturities through 2051. These securities may be used by the Company for short-term liquidity needs and held for short periods of time. The Company is required to hold highly-rated, investment grade securities and such investments are restricted to satisfy outstanding settlement obligations in accordance with applicable regulatory requirements.Gains and losses on investment securities are calculated using the specific-identification method and are recognized in earnings during the period in which the investment is sold or when an investment experiences an other-than-temporary decline in value. Factors that could indicate an impairment exists include, but are not limited to: (i) earnings performance, (ii) changes in credit rating, or (iii) adverse changes in the regulatory or economic environment of the asset. If potential impairment exists, the Company assesses (i) whether it has the intent to sell the investment security, (ii) will more likely than not be required to sell the investment security before its anticipated recovery, or (iii) expects that some of the contractual cash flows will not be received. The Company had no material, other-than-temporary impairments during the periods presented. |
Foreign Currency - Derivatives | Foreign Currency Derivatives The Company’s policy is to use long duration foreign currency forward contracts, with maturities of up to 36 months at inception and a targeted weighted-average maturity of approximately one year, to help mitigate some of the risk that changes in foreign currency exchange rates compared to the United States dollar could have on forecasted revenues denominated in other currencies related to its business. As of December 31, 2019, these foreign currency forward contracts had maturities of a maximum of 24 months with a weighted-average maturity of approximately one year. These contracts are accounted for as cash flow hedges of forecasted revenue, with effectiveness assessed based on changes in the spot rate of the affected currencies during the period of designation and thus time value is excluded from the assessment of effectiveness. As described in Note 2, foreign currency cash flow hedges entered into on or after January 1, 2018 exclude time value from the assessment of effectiveness, and the initial value of the excluded components is amortized into Revenues within the Company’s Consolidated Statements of Income/(Loss). For foreign currency cash flow hedges entered into before January 1, 2018, all changes in the fair value of the excluded components are recognized immediately in Revenues. The Company also uses short duration foreign currency forward contracts, generally with maturities ranging from a few days to one month, to offset foreign exchange rate fluctuations on settlement assets and obligations between initiation and settlement. In addition, forward contracts, typically with maturities of less than one year at inception, are utilized to offset foreign exchange rate fluctuations on certain foreign currency denominated cash and other asset and liability positions. None of these contracts are designated as accounting hedges. |
Foreign Currency - Business Solutions | Business Solutions Operations The Company writes derivatives, primarily foreign currency forward contracts and option contracts, mostly with small and medium size enterprises and derives a currency spread from this activity as part of its Business Solutions operations. The Company aggregates its Business Solutions foreign currency exposures arising from customer contracts, including the derivative contracts described above, and hedges the resulting net currency risks by entering into offsetting contracts with established financial institution counterparties (economic hedge contracts). The derivatives written are part of the broader portfolio of foreign currency positions arising from the Company’s cross-currency payments operations, which primarily include spot exchanges of currency in addition to forwards and options. Foreign exchange revenues from the total portfolio of positions were $343.1 million, $342.3 million, and $341.0 million for the years ended December 31, 2019, 2018, and 2017, respectively, and were included in Revenues in the Company’s Consolidated Statements of Income/(Loss). None of the derivative contracts used in Business Solutions operations are designated as accounting hedges and the duration of these derivative contracts at inception is generally less than one year. The aggregate equivalent United States dollar notional amount of derivative customer contracts held by the Company in its Business Solutions operations as of December 31, 2019 and December 31, 2018 was approximately $7.5 billion and $6.0 billion, respectively. The significant majority of customer contracts are written in the following currencies: the United States dollar, euro, and the Canadian dollar. |
Interest Rate Hedging | Interest Rate Hedging From time to time, the Company utilizes interest rate swaps to effectively change the interest rate payments on a portion of its notes from fixed-rate payments to short-term, LIBOR-based, variable rate payments in order to manage its overall exposure to interest rate fluctuations. The Company designates these derivatives as fair value hedges. The change in fair value of the interest rate swaps is offset by a change in the carrying value of the debt being hedged within Borrowings in the Consolidated Balance Sheets. Interest expense in the Consolidated Statements of Income/(Loss) has been adjusted to include the effects of interest accrued on the swaps. |
Segments | The Company’s segments are reviewed separately below because each segment represents a strategic business unit that offers different products and serves different markets. The business segment measurements provided to, and evaluated by, the Company’s CODM are computed in accordance with the following principles: ● The accounting policies of the segments are the same as those described in the summary of significant accounting policies. ● Corporate costs, including stock-based compensation and other overhead, are allocated to the segments primarily based on a percentage of the segments’ revenue compared to total revenue. ● As described in Note 4, on August 1, 2019, the Company’s Board of Directors approved an overall plan to change the Company’s operating model and improve its business processes and cost structure by reducing its headcount and consolidating various facilities. For the year ended December 31, 2019, the Company incurred $115.5 million related to this plan. While certain of these expenses may be identifiable to the Company’s segments, primarily the Company’s Consumer-to-Consumer segment, the expenses are not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As described in Note 5, during the year ended December 31, 2017, the Company recognized a goodwill impairment charge of $464.0 million related to its Business Solutions reporting unit. While the impairment was identifiable to the Business Solutions segment, it was not allocated to the segment, as it was not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As described in Note 6, during the year ended December 31, 2017, the Company incurred $60.0 million of expenses related to the NYDFS Consent Order and $8.0 million of expenses related to the Joint Settlement Agreements. While these expenses were identifiable to the Company’s Consumer-to-Consumer segment, they were not allocated to the segment, as they were not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. ● As of December 31, 2017, expenses associated with the WU Way initiative were effectively complete. The Company incurred expenses related to the WU Way of $94.4 million during the year ended December 31, 2017. While certain items related to the initiative were identifiable to the Company’s segments, they were not included in the measurement of segment operating income provided to the CODM for purposes of assessing segment performance and decision making with respect to resource allocation. For additional information on this business transformation initiative, see Note 4. ● The CODM does not review total assets by segment for purposes of assessing segment performance and allocating resources. As such, the disclosure of total assets by segment has not been included below. ● All items not included in operating income are excluded from the segments. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Schedule of diluted weighted-average shares outstanding | The following table provides the calculation of diluted weighted-average shares outstanding (in millions): Year Ended December 31, 2019 2018 2017 Basic weighted-average shares outstanding 427.6 451.8 467.9 Common stock equivalents 3.3 2.6 — Diluted weighted-average shares outstanding 430.9 454.4 467.9 |
Schedule of settlement assets and obligations | Settlement assets and obligations consisted of the following (in millions): December 31, 2019 2018 Settlement assets: Cash and cash equivalents $ 368.2 $ 1,247.8 Receivables from selling agents and Business Solutions customers 1,230.1 1,355.4 Investment securities 1,698.4 1,210.6 Total settlement assets $ 3,296.7 $ 3,813.8 Settlement obligations: Money transfer, money order, and payment service payables $ 2,571.5 $ 2,793.6 Payables to agents 725.2 1,020.2 Total settlement obligations $ 3,296.7 $ 3,813.8 |
Schedule of property and equipment | Property and equipment consisted of the following (in millions): December 31, 2019 2018 Equipment $ 591.4 $ 656.8 Leasehold improvements 159.2 158.6 Buildings 0.4 88.6 Furniture and fixtures 49.4 51.6 Land and improvements — 17.0 Projects in process 3.0 0.2 Total property and equipment, gross 803.4 972.8 Less accumulated depreciation (616.5) (702.4) Property and equipment, net (a) $ 186.9 $ 270.4 (a) At December 31, 2019, Property and equipment, net, excludes assets held for sale of $49.3 million, which primarily consists of the Company’s former headquarters, which was sold in January 2020, and land. These assets are included in Other assets in the Company’s Consolidated Balance Sheets. |
Schedule of components of other intangible assets | The following table provides the components of other intangible assets (in millions): December 31, 2019 December 31, 2018 Weighted- Average Amortization Net of Net of Period Accumulated Accumulated (in years) Initial Cost Amortization Initial Cost Amortization Acquired contracts 11.5 $ 584.2 $ 124.1 $ 598.1 $ 171.2 Capitalized contract costs 6.2 510.3 271.7 536.5 318.9 Internal use software 3.8 281.2 54.7 447.3 80.6 Acquired trademarks 25.4 30.1 13.2 32.5 15.5 Other intangibles 4.3 19.4 — 19.4 — Projects in process (a) 31.2 31.2 12.0 12.0 Total other intangible assets 8.1 $ 1,456.4 $ 494.9 $ 1,645.8 $ 598.2 (a) Not applicable as the assets have not been placed in service. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue | |
Disaggregation of revenue earned from contracts with customers | Management has determined that the significant majority of the Company’s revenue is recognized at a point in time. The following tables represent the disaggregation of revenue earned from contracts with customers by product type and region for the years ended December 31, 2019 and 2018 (in millions). The regional split of revenue shown in the tables below is based upon where transactions are initiated. Revenues that would have been reported under previous accounting guidance would not have been materially different from the amounts shown below: Year Ended December 31, 2019 Foreign Consumer Exchange Money and Payment Consumer Other Transfers Services Bill Payments (c) Services Total Regions: North America $ 1,653.5 $ 95.4 $ 223.0 $ 55.9 $ 2,027.8 Europe and Russia/CIS 1,350.1 127.1 3.2 4.1 1,484.5 Middle East, Africa, and South Asia 642.0 1.8 0.4 — 644.2 Latin America and the Caribbean 395.2 3.4 129.4 15.3 543.3 East Asia and Oceania 263.5 68.4 1.5 — 333.4 Revenues from contracts with customers $ 4,304.3 $ 296.1 $ 357.5 $ 75.3 $ 5,033.2 Other revenues (a) 103.5 92.7 37.3 25.4 258.9 Total revenues (b) $ 4,407.8 $ 388.8 $ 394.8 $ 100.7 $ 5,292.1 Year Ended December 31, 2018 Foreign Consumer Exchange Money and Payment Consumer Other Transfers Services Bill Payments (c) Services Total Regions: North America $ 1,632.3 $ 97.6 $ 463.9 $ 57.4 $ 2,251.2 Europe and Russia/CIS 1,399.5 130.0 3.1 3.9 1,536.5 Middle East, Africa, and South Asia 654.4 1.5 0.3 — 656.2 Latin America and the Caribbean 393.2 3.1 152.7 13.7 562.7 East Asia and Oceania 304.6 69.9 1.5 — 376.0 Revenues from contracts with customers $ 4,384.0 $ 302.1 $ 621.5 $ 75.0 $ 5,382.6 Other revenues (a) 69.6 84.7 30.8 22.2 207.3 Total revenues (b) $ 4,453.6 $ 386.8 $ 652.3 $ 97.2 $ 5,589.9 (a) Includes revenue from the sale of derivative financial instruments, investment income generated on settlement assets primarily related to money transfer and money order services, and other sources. (b) Revenues from “Consumer money transfers” are included in the Company’s Consumer-to-Consumer segment, revenues from “Foreign exchange and payment services” are included in the Company’s Business Solutions segment, and revenues from “Consumer bill payments” and “Other services” are not included in the Company’s segments and are reported as Other. See Note 18 for further information on the Company’s segments . (c) On February 28, 2019, the Company entered into an agreement with ACI Worldwide Corp. and ACW Worldwide, Inc. to sell its United States electronic bill payments business known as “Speedpay,” and closed the transaction on May 9, 2019. Included within North America revenues are Speedpay revenues of $125.4 million and $352.0 million for the years ended December 31, 2019 and 2018, respectively. |
Restructuring-Related Expense_2
Restructuring-Related Expenses and Business Transformation Expenses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring-Related Expenses and Business Transformation Expenses | |
Schedule of restructuring accruals | The following table summarizes the activity for the year ended December 31, 2019 for expenses related to the restructuring accruals, which are included in Accounts payable and accrued liabilities in the Company’s Consolidated Balance Sheets as of December 31, 2019 (in millions): Severance and Facility Relocations Related and Closures, Employee Consulting, Benefits and Other Total Balance, December 31, 2018 $ — $ — $ — Expenses (a) 98.0 17.5 115.5 Cash payments (28.6) (9.6) (38.2) Non-cash benefits/(charges) (a) 1.8 (5.8) (4.0) Balance, December 31, 2019 $ 71.2 $ 2.1 $ 73.3 (a) Non-cash benefits/(charges) include non-cash write-offs and accelerated depreciation of ROU assets and leasehold improvements and a non-cash benefit for adjustments to stock compensation for awards forfeited by employees. These amounts have been removed from the liability balance in the table above as they do not impact the restructuring accruals. |
Schedule of restructuring-related expenses | The following table presents restructuring-related expenses as reflected in the Consolidated Statements of Income/(Loss) (in millions): Year Ended December 31, 2019 Cost of services $ 39.8 Selling, general, and administrative 75.7 Total expenses, pre-tax $ 115.5 Total expenses, net of tax $ 90.0 |
Schedule of business transformation and productivity and cost-savings initiatives expenses in the Consolidated Statements of Income | The following table presents expenses related to business transformation initiatives as reflected in the Consolidated Statements of Income/(Loss) (in millions): Year Ended December 31, 2017 Cost of services $ 35.7 Selling, general, and administrative 58.7 Total expenses, pre-tax $ 94.4 Total expenses, net of tax $ 63.3 |
Divestitures, Business Combin_2
Divestitures, Business Combinations, and Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Divestitures, Business Combinations, and Goodwill | |
Schedule of changes to goodwill | The following table presents changes to goodwill for the years ended December 31, 2019 and 2018 (in millions): Consumer-to- Business Consumer Solutions Other Total January 1, 2018 goodwill, net $ 1,981.0 $ 532.0 $ 214.9 $ 2,727.9 Purchase accounting adjustments (0.3) — — (0.3) Currency translation — — (2.6) (2.6) December 31, 2018 goodwill, net $ 1,980.7 $ 532.0 $ 212.3 $ 2,725.0 Divestitures (a) — — (158.4) (158.4) December 31, 2019 goodwill, net $ 1,980.7 $ 532.0 $ 53.9 $ 2,566.6 (a) Related to the Speedpay and Paymap divestitures, as described above. |
Schedule of accumulated impairment losses of goodwill | The following table presents accumulated impairment losses as of December 31, 2019, 2018, and 2017 (in millions): As of December 31, 2019 2018 2017 Goodwill, gross $ 3,030.6 $ 3,189.0 $ 3,191.9 Accumulated impairment losses (464.0) (464.0) (464.0) Goodwill, net $ 2,566.6 $ 2,725.0 $ 2,727.9 |
Investment Securities (Tables)
Investment Securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investment Securities | |
Schedule of components of investment securities | The components of investment securities are as follows (in millions): Gross Gross Net Amortized Fair Unrealized Unrealized Unrealized December 31, 2019 Cost Value Gains Losses Gains/(Losses) Settlement assets: Cash and cash equivalents: Money market funds $ 24.6 $ 24.6 $ — $ — $ — Available-for-sale securities: State and municipal debt securities (a) 1,227.4 1,257.8 31.0 (0.6) 30.4 State and municipal variable-rate demand notes 276.1 276.1 — — — United States government agency mortgage-backed securities 66.3 67.2 0.9 — 0.9 Corporate debt securities 52.3 52.4 0.1 — 0.1 Other United States government agency debt securities 34.9 34.9 — — — United States Treasury securities 9.8 10.0 0.2 — 0.2 Total investment securities within Settlement assets 1,666.8 1,698.4 32.2 (0.6) 31.6 Total investment securities $ 1,691.4 $ 1,723.0 $ 32.2 $ (0.6) $ 31.6 Gross Gross Net Amortized Fair Unrealized Unrealized Unrealized December 31, 2018 Cost Value Gains Losses Gains/(Losses) Cash and cash equivalents: Money market funds $ 27.0 $ 27.0 $ — $ — $ — Settlement assets: Cash and cash equivalents: Money market funds 23.9 23.9 — — — Available-for-sale securities: State and municipal debt securities (a) 963.4 962.7 6.1 (6.8) (0.7) State and municipal variable-rate demand notes 168.7 168.7 — — — Corporate and other debt securities 70.0 69.5 — (0.5) (0.5) United States Treasury securities 9.9 9.7 — (0.2) (0.2) Total investment securities within Settlement assets 1,212.0 1,210.6 6.1 (7.5) (1.4) Other assets: Held-to-maturity securities: Foreign corporate debt securities 32.9 32.9 — — — Total investment securities $ 1,295.8 $ 1,294.4 $ 6.1 $ (7.5) $ (1.4) (a) The majority of these securities are fixed-rate instruments. |
Schedule of contractual maturities of investment securities within Settlement assets | The following summarizes the contractual maturities of investment securities within Settlement assets as of December 31, 2019 (in millions): Fair Value Due within 1 year $ 182.5 Due after 1 year through 5 years 572.2 Due after 5 years through 10 years 525.3 Due after 10 years 418.4 $ 1,698.4 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Measurements | |
Schedule of assets and liabilities by balance sheet line item measured on a recurring basis | The following tables present the Company’s assets and liabilities which are measured at fair value on a recurring basis, by balance sheet line item (in millions): Fair Value Measurement Using Total December 31, 2019 Level 1 Level 2 Fair Value Assets: Settlement assets: Measured at fair value through net income: Money market funds $ 24.6 $ — $ 24.6 Measured at fair value through other comprehensive income: State and municipal debt securities — 1,257.8 1,257.8 State and municipal variable-rate demand notes — 276.1 276.1 United States government agency mortgage-backed securities — 67.2 67.2 Corporate debt securities — 52.4 52.4 Other United States government agency debt securities — 34.9 34.9 United States Treasury securities 10.0 — 10.0 Other assets: Derivatives — 204.5 204.5 Total assets $ 34.6 $ 1,892.9 $ 1,927.5 Liabilities: Other liabilities: Derivatives $ — $ 159.5 $ 159.5 Total liabilities $ — $ 159.5 $ 159.5 Fair Value Measurement Using Total December 31, 2018 Level 1 Level 2 Fair Value Assets: Cash and cash equivalents: Measured at fair value through net income: Money market funds $ 27.0 $ — $ 27.0 Settlement assets: Measured at fair value through net income: Money market funds 23.9 — 23.9 Measured at fair value through other comprehensive income: State and municipal debt securities — 962.7 962.7 State and municipal variable-rate demand notes — 168.7 168.7 Corporate and other debt securities — 69.5 69.5 United States Treasury securities 9.7 — 9.7 Other assets: Derivatives — 245.5 245.5 Total assets $ 60.6 $ 1,446.4 $ 1,507.0 Liabilities: Other liabilities: Derivatives $ — $ 176.2 $ 176.2 Total liabilities $ — $ 176.2 $ 176.2 |
Other Assets and Other Liabil_2
Other Assets and Other Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Assets and Other Liabilities | |
Schedule of components of other assets and other liabilities | The following table summarizes the components of Other assets and Other liabilities (in millions): December 31, 2019 2018 Other assets: Derivatives $ 204.5 $ 245.5 ROU assets (Note 13) 199.7 — Prepaid expenses 102.4 101.3 Amounts advanced to agents 96.4 57.6 Equity method investments 33.0 31.3 Other (a) 126.9 180.3 Total other assets $ 762.9 $ 616.0 Other liabilities: Operating lease liabilities (Note 13) $ 242.3 $ — Derivatives 159.5 176.2 Pension obligations 11.4 16.0 Other 85.1 86.9 Total other liabilities $ 498.3 $ 279.1 (a) Property, equipment, and land of $49.3 million, which is primarily related to the Company’s former headquarters, is included in Other as of December 31, 2019 and is classified as held for sale. In the first quarter of 2020, the Company sold its former corporate headquarters and expects to record an immaterial gain on the sale. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Taxes | |
Schedule of components of pre-tax income | The components of pre-tax income, generally based on the jurisdiction of the legal entity, were as follows (in millions): Year Ended December 31, 2019 2018 2017 Domestic $ 434.7 $ (11.4) $ (238.8) Foreign 886.7 1,002.8 586.3 Total pre-tax income $ 1,321.4 $ 991.4 $ 347.5 |
Schedule of provision for income taxes | The provision for income taxes was as follows (in millions): Year Ended December 31, 2019 2018 2017 Federal $ 153.7 $ 62.9 $ 848.5 State and local 22.9 0.6 5.4 Foreign 86.5 76.0 50.7 Total provision for income taxes $ 263.1 $ 139.5 $ 904.6 |
Schedule of effective tax rate reconciliation | The Company’s effective tax rates differed from statutory rates as follows: Year Ended December 31, 2019 2018 2017 Federal statutory rate 21.0 % 21.0 % 35.0 % State income taxes, net of federal income tax benefits 1.4 % 0.4 % 1.7 % Foreign rate differential, net of United States tax paid on foreign earnings (2.3%, 4.9%, and 1.1%, respectively) (5.5) % (8.2) % (69.3) % Divestitures 2.4 % — % — % Tax Act impact — % 2.3 % 251.5 % NYDFS Consent Order impact — % — % 6.0 % Goodwill impairment — % — % 46.7 % Base erosion anti-abuse tax (BEAT) — % 3.0 % — % Lapse of statute of limitations (0.5) % (2.2) % (10.0) % Valuation allowances 0.1 % — % 0.8 % Other 1.0 % (2.2) % (2.1) % Effective tax rate 19.9 % 14.1 % 260.3 % |
Schedule of components of provision for income taxes, current and deferred | The Company’s provision for income taxes consisted of the following components (in millions): Year Ended December 31, 2019 2018 2017 Current: Federal $ 169.4 $ 69.2 $ 774.4 State and local 18.1 — 1.0 Foreign 100.1 85.4 59.7 Total current taxes 287.6 154.6 835.1 Deferred: Federal (15.7) (6.3) 74.1 State and local 4.8 0.6 4.4 Foreign (13.6) (9.4) (9.0) Total deferred taxes (24.5) (15.1) 69.5 $ 263.1 $ 139.5 $ 904.6 |
Schedule of components of deferred tax items | Deferred tax assets and liabilities are recognized for the expected tax consequences of temporary differences between the book and tax bases of the Company’s assets and liabilities. The following table outlines the principal components of deferred tax items (in millions): December 31, 2019 2018 Deferred tax assets related to: Reserves, accrued expenses and employee-related items $ 38.3 $ 42.6 Lease liabilities 28.1 — Tax attribute carryovers 31.7 29.9 Pension obligations 4.0 4.8 Intangibles, property and equipment 13.6 8.5 Other 5.3 5.3 Valuation allowance (19.1) (15.7) Total deferred tax assets 101.9 75.4 Deferred tax liabilities related to: Intangibles, property and equipment 214.8 228.0 Lease right-of-use assets 18.7 — Other 6.9 — Total deferred tax liabilities 240.4 228.0 Net deferred tax liability (a) $ 138.5 $ 152.6 (a) As of December 31, 2019 and 2018, deferred tax assets that cannot be fully offset by deferred tax liabilities in the respective tax jurisdictions of $13.6 million and $8.5 million, respectively, are reflected in Other assets in the Consolidated Balance Sheets. |
Schedule of unrecognized tax benefits reconciliation | Unrecognized tax benefits represent the aggregate tax effect of differences between tax return positions and the amounts otherwise recognized in the Company’s consolidated financial statements, and are reflected in Income taxes payable in the Consolidated Balance Sheets. A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest and penalties, is as follows (in millions): 2019 2018 Balance as of January 1 $ 295.0 $ 329.0 Increase related to current period tax positions (a) 5.2 4.0 Increase related to prior period tax positions 0.8 0.4 Decrease related to prior period tax positions (1.6) (18.5) Decrease due to lapse of applicable statute of limitations (5.3) (17.7) Increase/(decrease) due to effects of foreign currency exchange rates (0.2) (2.2) Balance as of December 31 $ 293.9 $ 295.0 (a) Includes recurring accruals for issues which initially arose in previous periods. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases | |
Schedule of weighted average lease terms and discount rates | The following table summarizes the weighted-average lease term and discount rate for operating lease liabilities as of December 31, 2019: Weighted-average remaining lease term (in years) 7.6 Weighted-average discount rate 6.5 % |
Schedule of maturities of operating lease liabilities | The following table represents maturities of operating lease liabilities as of December 31, 2019 (in millions): Due within 1 year $ 53.2 Due after 1 year through 2 years 45.2 Due after 2 years through 3 years 38.5 Due after 3 years through 4 years 32.6 Due after 4 years through 5 years 30.5 Due after 5 years 102.5 Total lease payments 302.5 Less imputed interest (60.2) Total operating lease liabilities $ 242.3 |
Schedule of minimum aggregate rental commitments under all non-cancelable operating leases | As of December 31, 2018, the minimum aggregate rental commitments under all non-cancelable operating leases, as determined under accounting standards in effect in this period, were as follows (in millions): Year Ending December 31, 2019 $ 51.6 2020 44.1 2021 35.4 2022 31.4 2023 25.2 Thereafter 112.6 Total future minimum lease payments $ 300.3 |
Stockholders' Equity_(Deficit)
Stockholders' Equity/(Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity/(Deficit) | |
Schedule of reclassifications out of Accumulated other comprehensive loss | The following table details reclassifications out of AOCL and into Net income. All amounts reclassified from AOCL affect the line items as indicated below and the amounts in parentheses indicate decreases to Net income in the Consolidated Statements of Income/(Loss). Amounts Reclassified from AOCL to Net Income Income Statement Year Ended December 31, Income for the period (in millions) Location 2019 2018 2017 Accumulated other comprehensive loss components: Gains/(losses) on investment securities: Available-for-sale securities Revenues $ 0.6 $ (0.4) $ 2.4 Income tax (expense)/benefit Provision for income taxes (0.1) 0.1 (0.9) Total reclassification adjustments related to investment securities, net of tax 0.5 (0.3) 1.5 Gains/(losses) on cash flow hedges: Foreign currency contracts Revenues 14.2 (14.9) 4.8 Interest rate contracts Interest expense — (2.1) (3.3) Income tax (expense)/benefit Provision for income taxes (0.1) 0.7 1.2 Total reclassification adjustments related to cash flow hedges, net of tax 14.1 (16.3) 2.7 Amortization of components of defined benefit plans: Actuarial loss Other income, net (10.8) (11.7) (11.3) Income tax benefit Provision for income taxes 2.4 2.6 4.1 Total reclassification adjustments related to defined benefit plans, net of tax (8.4) (9.1) (7.2) Total reclassifications, net of tax $ 6.2 $ (25.7) $ (3.0) |
Schedule of components of accumulated other comprehensive income/(loss), net of tax | The following tables summarize the components of AOCL, net of tax in the accompanying Consolidated Balance Sheets (in millions): Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2018 $ (1.1) $ 7.4 $ (101.2) $ (136.1) $ (231.0) Unrealized gains/(losses) 33.6 2.0 — (2.0) 33.6 Tax benefit/(expense) (7.3) 1.1 — 0.8 (5.4) Amounts reclassified from AOCL into earnings, net of tax (0.5) (14.1) — 8.4 (6.2) As of December 31, 2019 $ 24.7 $ (3.6) $ (101.2) $ (128.9) $ (209.0) Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2017 $ 2.7 $ (40.6) $ (76.9) $ (113.1) $ (227.9) Unrealized gains/(losses) (5.9) 35.6 — (9.3) 20.4 Tax benefit/(expense) 1.3 (1.6) — 2.0 1.7 Amounts reclassified from AOCL into earnings, net of tax 0.3 16.3 — 9.1 25.7 Foreign currency translation adjustments (a) — — (19.5) — (19.5) Reclassification of Tax Act effects into Accumulated deficit (b) 0.5 (2.3) (4.8) (24.8) (31.4) As of December 31, 2018 $ (1.1) $ 7.4 $ (101.2) $ (136.1) $ (231.0) Investment Hedging Foreign Currency Defined Benefit Securities Activities Translation Pension Plan Total As of December 31, 2016 $ (3.8) $ 33.8 $ (70.7) $ (122.1) $ (162.8) Unrealized gains/(losses) 12.6 (73.9) — 2.3 (59.0) Tax benefit/(expense) (4.6) 2.2 0.6 (0.5) (2.3) Amounts reclassified from AOCL into earnings, net of tax (1.5) (2.7) — 7.2 3.0 Foreign currency translation adjustments (a) — — (6.8) — (6.8) As of December 31, 2017 $ 2.7 $ (40.6) $ (76.9) $ (113.1) $ (227.9) (a) Beginning in the third quarter of 2018, all changes in the value of the Argentine peso on the Company’s monetary assets and liabilities are reflected in net income, given Argentina’s status as a highly inflationary economy. Prior to the third quarter of 2018, changes in the Argentine peso exchange rate were reflected in net income for the Company’s money transfer operations, whereas these effects were reflected in other comprehensive income for the Company’s bill payment operations. This designation did not have a material impact on the Company’s financial position and results of operations for the years ended December 31, 2019 and 2018. (b) As discussed in Note 2, in the first quarter of 2018, the Company adopted an accounting pronouncement as a result of the Tax Act and reclassified tax effects included within AOCL to Accumulated deficit in the Consolidated Balance Sheets. |
Schedule of dividends declared | Cash dividends paid for the years ended December 31, 2019, 2018, and 2017 were $340.8 million, $341.7 million, and $325.6 million, respectively. Dividends per share declared quarterly by the Company’s Board of Directors during the years ended 2019, 2018, and 2017 were as follows: Year Q1 Q2 Q3 Q4 2019 $ 0.20 $ 0.20 $ 0.20 $ 0.20 2018 $ 0.19 $ 0.19 $ 0.19 $ 0.19 2017 $ 0.175 $ 0.175 $ 0.175 $ 0.175 |
Derivatives (Tables)
Derivatives (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivatives | |
Schedule of notional amounts of foreign currency forward contracts | The aggregate equivalent United States dollar notional amounts of foreign currency forward contracts as of December 31, 2019 and December 31, 2018 were as follows (in millions): December 31, 2019 Contracts designated as hedges: Euro $ 391.9 Canadian dollar 99.0 British pound 57.2 Australian dollar 36.1 Swiss franc 28.9 Other (a) 50.9 Contracts not designated as hedges: Euro $ 289.0 Canadian dollar 110.3 British pound 78.1 Indian rupee 61.0 Mexican peso 52.3 Japanese yen 37.7 Australian dollar 35.2 Brazilian real 32.5 Other (a) 145.6 (a) Comprised of exposures to various currencies as of December 31, 2019. None of these individual currency exposures is greater than $25 million. December 31, 2018 Contracts designated as hedges: Euro $ 364.7 Canadian dollar 97.1 British pound 76.4 Australian dollar 45.3 Japanese yen 25.2 Other (a) 50.1 Contracts not designated as hedges: Euro $ 274.4 British pound 81.5 Canadian dollar 46.0 Australian dollar 39.0 Indian rupee 37.2 Brazilian real 35.8 Japanese yen 34.3 Mexican peso 34.2 Other (a) 138.5 (a) Comprised of exposures to various currencies as of December 31, 2018. None of these individual currency exposures is greater than $25 million. |
Schedule of fair value of derivatives | The following table summarizes the fair value of derivatives reported in the Company’s Consolidated Balance Sheets as of December 31, 2019 and December 31, 2018 (in millions): Derivative Assets Derivative Liabilities Fair Value Fair Value Balance Sheet December 31, December 31, Balance Sheet December 31, December 31, Location 2019 2018 Location 2019 2018 Derivatives designated as hedges: Interest rate fair value hedges Other assets $ — $ 0.1 Other liabilities $ — $ — Foreign currency cash flow hedges Other assets 21.0 28.6 Other liabilities 4.8 2.8 Total derivatives designated as hedges $ 21.0 $ 28.7 $ 4.8 $ 2.8 Derivatives not designated as hedges: Business Solutions operations - foreign currency (a) Other assets $ 182.0 $ 214.2 Other liabilities $ 151.0 $ 170.9 Foreign currency Other assets 1.5 2.6 Other liabilities 3.7 2.5 Total derivatives not designated as hedges $ 183.5 $ 216.8 $ 154.7 $ 173.4 Total derivatives $ 204.5 $ 245.5 $ 159.5 $ 176.2 (a) In many circumstances, the Company allows its Business Solutions customers to settle part or all of their derivative contracts prior to maturity. However, the offsetting positions originally entered into with financial institution counterparties do not allow for similar settlement. To mitigate this, additional foreign currency contracts are entered into with financial institution counterparties to offset the original economic hedge contracts. This frequently results in changes in the Company’s derivative assets and liabilities that may not directly align with the performance in the underlying derivatives business. |
Schedule of gross and net fair value of derivative assets | The following tables summarize the gross and net fair value of derivative assets and liabilities as of December 31, 2019 and December 31, 2018 (in millions): Offsetting of Derivative Assets Gross Net Amounts Derivatives Gross Amounts Presented Not Offset Amounts of Offset in the in the in the Recognized Consolidated Consolidated Consolidated December 31, 2019 Assets Balance Sheets Balance Sheets Balance Sheets Net Amounts Derivatives subject to a master netting arrangement or similar agreement $ 95.3 $ — $ 95.3 $ (74.7) $ 20.6 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 109.2 Total $ 204.5 December 31, 2018 Derivatives subject to a master netting arrangement or similar agreement $ 162.6 $ — $ 162.6 $ (95.7) $ 66.9 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 82.9 Total $ 245.5 |
Schedule of gross and net fair value of derivative liabilities | Offsetting of Derivative Liabilities Gross Net Amounts Derivatives Gross Amounts Presented Not Offset Amounts of Offset in the in the in the Recognized Consolidated Consolidated Consolidated December 31, 2019 Liabilities Balance Sheets Balance Sheets Balance Sheets Net Amounts Derivatives subject to a master netting arrangement or similar agreement $ 121.8 $ — $ 121.8 $ (74.7) $ 47.1 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 37.7 Total $ 159.5 December 31, 2018 Derivatives subject to a master netting arrangement or similar agreement $ 104.1 $ — $ 104.1 $ (95.7) $ 8.4 Derivatives that are not or may not be subject to master netting arrangement or similar agreement 72.1 Total $ 176.2 |
Schedule of amount and location of gains/(losses) from hedging activities | The following table presents the pre-tax amount of unrealized gains/(losses) recognized in other comprehensive income from cash flow hedges for the years ended December 31, 2019, 2018, and 2017 (in millions): 2019 2018 2017 Foreign currency derivatives (a) $ 2.0 $ 35.6 $ (73.9) (a) For the years ended December 31, 2019 and 2018, gains of $1.5 million and $0.1 million, respectively, represent the amounts excluded from the assessment of effectiveness that were recognized in other comprehensive income, for which an amortization approach is applied. For the year ended December 31, 2017, there were no amounts recorded in other comprehensive income for amounts excluded from the measurement of effectiveness. The following table presents the location and amount of pre-tax net gains/(losses) from fair value and cash flow hedging relationships recognized in the Consolidated Statements of Income/(Loss) for the years ended December 31, 2019, 2018, and 2017 (in millions): 2019 2018 2017 Other Interest Interest Interest Income, Revenues Expense Revenues Expense Revenues Expense Net Total amounts presented in the Consolidated Statements of Income/(Loss) in which the effects of fair value or cash flow hedges are recorded $ 5,292.1 $ (152.0) $ 5,589.9 $ (149.6) $ 5,524.3 $ (142.1) $ 8.9 The effects of fair value and cash flow hedging: Gain/(loss) on fair value hedges: Interest rate derivatives: Hedged items — (0.1) — 0.6 — 3.9 — Derivatives designated as hedging instruments — 1.0 — (1.6) — (2.0) — Gain/(loss) on cash flow hedges: Foreign currency derivatives: Gains/(losses) reclassified from AOCL into earnings 14.2 — (14.9) — 4.8 — — Amount excluded from effectiveness testing recognized in earnings based on an amortization approach 11.5 — 4.3 — — — — Amount excluded from effectiveness testing recognized in earnings based on changes in fair value 2.9 — 7.5 — — — 9.0 Losses reclassified from AOCL into income resulting from forecasted transactions no longer probable of occurring — — — — — — (1.4) Undesignated Hedges The following table presents the location and amount of pre-tax net gains/(losses) from undesignated hedges for the years ended December 31, 2019, 2018, and 2017 (in millions): Gain/(Loss) Recognized in the Consolidated Statements of Income/(Loss) on Derivatives (a) Derivatives Location 2019 2018 2017 Foreign currency derivatives (b) Selling, general, and administrative $ 23.9 $ 58.6 $ (20.5) Foreign currency derivatives (c) Revenues 0.3 3.0 — Foreign currency derivatives (c) Other income, net — (1.8) (0.5) Total gain/(loss) $ 24.2 $ 59.8 $ (21.0) (a) The Company uses foreign currency forward and option contracts as part of its Business Solutions payments operations. These derivative contracts are excluded from this table as they are managed as part of a broader currency portfolio that includes non-derivative currency exposures. The gains and losses on these derivatives are included as part of the broader disclosure of portfolio revenue for this business discussed above. (b) The Company uses foreign currency forward contracts to offset foreign exchange rate fluctuations on settlement assets and obligations, as well as certain foreign currency denominated positions. Foreign exchange gains/(losses) on settlement assets and obligations, cash balances, and other assets and liabilities, not including amounts related to derivative activity as displayed above, and included in Selling, general, and administrative in the Consolidated Statements of Income/(Loss), were $(33.1) million, $(52.3) million, and $17.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. (c) All derivative contracts executed in the Company’s revenue hedging program prior to January 1, 2018 are not designated as hedges in the final month of the contract. The change in fair value in this final month was recorded to Revenues for the year ended December 31, 2018 and Other income, net for the year ended December 31, 2017. The amount recorded to Other income, net for the year ended December 31, 2018 relates to losses on certain undesignated foreign currency derivative contracts that were recognized after the Company determined that certain forecasted transactions were no longer probable of occurring. |
Borrowings (Tables)
Borrowings (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Borrowings | |
Schedule of outstanding borrowings | The Company’s outstanding borrowings consisted of the following (in millions): December 31, 2019 December 31, 2018 Commercial paper $ 245.0 $ 125.0 Notes: 3.350% notes due 2019 (a) — 250.0 Floating rate notes due 2019 (a) — 250.0 5.253% notes due 2020 (b) — 324.9 3.600% notes due 2022 (c) 500.0 500.0 4.250% notes due 2023 (c) 300.0 300.0 2.850% notes due 2025 (effective rate of 3.1%) (d) 500.0 — 6.200% notes due 2036 (c) 500.0 500.0 6.200% notes due 2040 (c) 250.0 250.0 Term loan facility borrowing (effective rate of 3.1%) 950.0 950.0 Total borrowings at par value 3,245.0 3,449.9 Fair value hedge accounting adjustments, net (e) — (0.1) Debt issuance costs and unamortized discount, net (15.7) (16.1) Total borrowings at carrying value (f) $ 3,229.3 $ 3,433.7 (a) Proceeds from the Speedpay divestiture, commercial paper, and cash, including cash generated from operations, were used to repay the May 2019 maturities of the $250.0 million of aggregate principal amount unsecured notes and $250.0 million of aggregate principal amount unsecured floating rate notes. (b) Proceeds from the 2.850% unsecured notes due in 2025 were used to repay the 2020 Notes of $324.9 million of aggregate principal amount unsecured notes, as further described below. (c) The difference between the stated interest rate and the effective interest rate is not significant. (d) On November 25, 2019, the Company issued $500.0 million of aggregate principal amount of 2.850% unsecured notes due in 2025, as further described below. (e) From time to time, the Company utilizes interest rate swaps designated as fair value hedges to effectively change the interest rate payments on a portion of its notes from fixed-rate payments to short-term LIBOR-based variable-rate payments in order to manage its overall exposure to interest rates. The changes in fair value of these interest rate swaps result in an offsetting hedge accounting adjustment recorded to the carrying value of the related note. These hedge accounting adjustments will be reclassified as reductions to or increases in Interest expense in the Consolidated Statements of Income/(Loss) over the life of the related notes and cause the effective rate of interest to differ from the notes’ stated rate. On November 15, 2019, the Company terminated these fair value hedges in connection with its repayment of the 2020 Notes and received cash of $0.9 million. (f) As of December 31, 2019, the Company’s weighted-average effective rate on total borrowings was approximately 4.0% . |
Schedule of maturities of borrowings | The following summarizes the Company’s maturities of notes and term loan at par value as of December 31, 2019 (in millions): Due within 1 year $ — Due after 1 year through 2 years 47.5 Due after 2 years through 3 years 547.5 Due after 3 years through 4 years 395.0 Due after 4 years through 5 years 760.0 Due after 5 years 1,250.0 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stock-Based Compensation Plans | |
Schedule of stock option activity | A summary of stock option activity for the year ended December 31, 2019 was as follows (options and aggregate intrinsic value in millions): Weighted-Average Remaining Aggregate Weighted-Average Contractual Term Intrinsic Options Exercise Price (Years) Value Outstanding as of January 1 6.2 $ 17.63 Granted 0.6 $ 17.68 Exercised (2.2) $ 16.26 Cancelled/forfeited (0.1) $ 18.49 Outstanding as of December 31 4.5 $ 18.31 5.2 $ 37.9 Options exercisable as of December 31 3.3 $ 18.17 4.1 $ 28.6 |
Schedule of restricted stock units and performance-based restricted stock units activity | A summary of activity for restricted stock units and performance-based restricted stock units for the year ended December 31, 2019 was as follows (units in millions): Weighted-Average Units Grant-Date Fair Value Non-vested as of January 1 7.1 $ 17.69 Granted 3.7 $ 18.01 Vested (2.2) $ 17.55 Forfeited (1.5) $ 17.58 Non-vested as of December 31 7.1 $ 17.92 |
Schedule of impact on earnings for stock-based compensation expense | The following table sets forth the total impact on earnings for stock-based compensation expense recognized in the Consolidated Statements of Income/(Loss) resulting from stock options, restricted stock units, performance-based restricted stock units and deferred stock units for the years ended December 31, 2019, 2018, and 2017 (in millions, except per share data): Year Ended December 31, 2019 2018 2017 Stock-based compensation expense $ (48.9) $ (47.7) $ (43.9) Income tax benefit from stock-based compensation expense 8.5 8.3 12.8 Net income/(loss) impact $ (40.4) $ (39.4) $ (31.1) Earnings/(loss) per share impact: Basic and diluted $ (0.09) $ (0.09) $ (0.07) |
Schedule of assumptions for the Black-Scholes option pricing model to determine the value of options granted | The Company used the following assumptions for the Black-Scholes option pricing model to determine the value of Western Union options granted: Year Ended December 31, 2019 2018 2017 Stock options granted: Weighted-average risk-free interest rate 2.5 % 2.8 % 2.1 % Weighted-average dividend yield 4.2 % 3.9 % 3.5 % Volatility 22.8 % 26.3 % 24.7 % Expected term (in years) 7.05 6.05 6.05 Weighted-average grant date fair value $ 2.56 $ 3.66 $ 3.39 |
Segments (Tables)
Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segments | |
Schedule of segment results | The following tables present the Company’s segment results for the years ended December 31, 2019, 2018, and 2017 (in millions): Year Ended December 31, 2019 2018 2017 Revenues: Consumer-to-Consumer $ 4,407.8 $ 4,453.6 $ 4,354.5 Business Solutions 388.8 386.8 383.9 Other (a) 495.5 749.5 785.9 Total consolidated revenues $ 5,292.1 $ 5,589.9 $ 5,524.3 Operating income: Consumer-to-Consumer $ 975.4 $ 1,048.2 $ 1,004.2 Business Solutions 46.8 23.4 13.8 Other (a) 27.3 50.5 84.2 Total segment operating income 1,049.5 1,122.1 1,102.2 Goodwill impairment charge (Note 5) — — (464.0) NYDFS Consent Order (Note 6) — — (60.0) Joint Settlement Agreements (Note 6) — — (8.0) Restructuring-related expenses and business transformation expenses (Note 4) (115.5) — (94.4) Total consolidated operating income $ 934.0 $ 1,122.1 $ 475.8 (a) Other primarily consists of the Company’s cash-based and electronic-based bill payment services which facilitate payments from consumers to businesses and other organizations. In May 2019, the Company sold a substantial majority of its United States based electronic bill payments services, as discussed in Note 5. Speedpay revenues included in the Company’s results were $125.4 million, $352.0 million, and $368.3 million for the years ended December 31, 2019, 2018, and 2017, respectively. Speedpay direct operating expenses were $98.2 million, $251.2 million, and $246.0 million for the years ended December 31, 2019, 2018, and 2017, respectively. Paymap revenues included in the Company’s results were $5.3 million, $16.2 million, and $19.0 million for the years ended December 31, 2019, 2018, and 2017, respectively. Paymap direct operating expenses were $2.2 million, $6.7 million, and $6.5 million for the years ended December 31, 2019, 2018, and 2017, respectively. Year Ended December 31, 2019 2018 2017 Depreciation and amortization: Consumer-to-Consumer $ 194.5 $ 189.9 $ 183.0 Business Solutions 39.6 41.9 42.5 Other 23.6 32.9 37.4 Total consolidated depreciation and amortization $ 257.7 $ 264.7 $ 262.9 Capital expenditures: Consumer-to-Consumer $ 97.0 $ 273.8 $ 120.2 Business Solutions 7.7 11.9 8.8 Other 23.0 53.3 48.1 Total capital expenditures $ 127.7 $ 339.0 $ 177.1 |
Schedule of revenue and long-lived assets by geographic areas | Information concerning principal geographic areas was as follows (in millions): Year Ended December 31, 2019 2018 2017 Revenue: United States $ 1,896.1 $ 2,126.2 $ 2,159.0 International 3,396.0 3,463.7 3,365.3 Total $ 5,292.1 $ 5,589.9 $ 5,524.3 Long-lived assets: United States (a) $ 173.7 $ 207.4 $ 156.8 International 62.5 63.0 57.4 Total $ 236.2 $ 270.4 $ 214.2 (a) Assets held for sale of $49.3 million, which primarily consists of the Company’s former headquarters, are included in Other assets as of December 31, 2019 in the Company’s Consolidated Balance Sheets. |
Quarterly Financial Informati_2
Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information (Unaudited) | |
Schedule of quarterly results | Summarized quarterly results for the years ended December 31, 2019 and 2018 were as follows (in millions, except per share data): Year Ended December 31, 2019 by Quarter: Q1 Q2 Q3 Q4 2019 Revenues $ 1,337.0 $ 1,340.5 $ 1,306.9 $ 1,307.7 $ 5,292.1 Expenses (a) 1,085.8 1,081.6 1,109.5 1,081.2 4,358.1 Operating income 251.2 258.9 197.4 226.5 934.0 Other income/(expense), net (b) (35.1) 486.7 (35.2) (29.0) 387.4 Income before income taxes 216.1 745.6 162.2 197.5 1,321.4 Provision for income taxes 43.0 130.8 27.2 62.1 263.1 Net income $ 173.1 $ 614.8 $ 135.0 $ 135.4 $ 1,058.3 Earnings per share: Basic $ 0.40 $ 1.43 $ 0.32 $ 0.32 $ 2.47 Diluted $ 0.39 $ 1.42 $ 0.32 $ 0.32 $ 2.46 Weighted-average shares outstanding: Basic 437.7 430.0 423.3 419.5 427.6 Diluted 439.9 432.3 426.8 424.7 430.9 Year Ended December 31, 2018 by Quarter: Q1 Q2 Q3 Q4 2018 Revenues $ 1,389.4 $ 1,411.1 $ 1,387.8 $ 1,401.6 $ 5,589.9 Expenses 1,124.5 1,127.5 1,085.2 1,130.6 4,467.8 Operating income 264.9 283.6 302.6 271.0 1,122.1 Other income/(expense), net (30.4) (28.1) (36.2) (36.0) (130.7) Income before income taxes 234.5 255.5 266.4 235.0 991.4 Provision for income taxes (c) 20.9 37.9 57.8 22.9 139.5 Net income $ 213.6 $ 217.6 $ 208.6 $ 212.1 $ 851.9 Earnings per share: Basic $ 0.46 $ 0.48 $ 0.47 $ 0.48 $ 1.89 Diluted $ 0.46 $ 0.47 $ 0.46 $ 0.48 $ 1.87 Weighted-average shares outstanding: Basic 460.3 457.2 446.8 442.9 451.8 Diluted 463.6 459.6 449.0 445.4 454.4 (a) Includes $7.4 million, $91.5 million, and $16.6 million in the second, third, and fourth quarters, respectively, of restructuring-related expenses. For more information, see Note 4. (b) Includes a gain on the sale of Speedpay of approximately $523 million in the second quarter. For more information, see Note 5. (c) Includes $(6.0) million, $(6.2) million, $26.6 million, and $8.1 million in the first, second, third, and fourth quarters, respectively, of adjustments related to the Tax Act, as further described in Note 11. |
Business and Basis of Present_2
Business and Basis of Presentation - Narrative (Details) $ in Millions | Dec. 31, 2019USD ($)item |
Business and Basis of Presentation | |
Number of countries and territories where services are primarily available through a network of agent locations (more than) | item | 200 |
Net assets subject to limitations | $ | $ 610 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Diluted Weighted-Average Shares Outstanding (Details) - shares shares in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Earnings/(Loss) Per Share | |||||||||||
Outstanding options to purchase shares of stock excluded from the diluted earnings per share calculation | 1.9 | 2.6 | 2.8 | ||||||||
Additional outstanding options to purchase shares of stock excluded from the diluted earnings per share calculation | 3 | ||||||||||
Calculation of diluted weighted-average shares outstanding | |||||||||||
Basic weighted-average shares outstanding | 419.5 | 423.3 | 430 | 437.7 | 442.9 | 446.8 | 457.2 | 460.3 | 427.6 | 451.8 | 467.9 |
Common stock equivalents | 3.3 | 2.6 | |||||||||
Diluted weighted-average shares outstanding | 424.7 | 426.8 | 432.3 | 439.9 | 445.4 | 449 | 459.6 | 463.6 | 430.9 | 454.4 | 467.9 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Allowance for Doubtful Accounts | |||
Allowance for doubtful accounts | $ 42.2 | $ 47.7 | |
Provision for doubtful accounts | $ 47.1 | $ 43.9 | $ 60.6 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Settlement Assets and Obligations (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Settlement assets: | ||
Cash and cash equivalents | $ 368.2 | $ 1,247.8 |
Receivables from selling agents and Business Solutions customers | 1,230.1 | 1,355.4 |
Investment securities | 1,698.4 | 1,210.6 |
Total settlement assets | 3,296.7 | 3,813.8 |
Settlement obligations: | ||
Money transfer, money order, and payment service payables | 2,571.5 | 2,793.6 |
Payables to agents | 725.2 | 1,020.2 |
Total settlement obligations | $ 3,296.7 | $ 3,813.8 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Property and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Property and Equipment | |||
Property and equipment, gross | $ 803.4 | $ 972.8 | |
Accumulated depreciation | (616.5) | (702.4) | |
Property and equipment, net | 186.9 | 270.4 | |
Assets held for sale | 49.3 | ||
Depreciation of Property and Equipment | |||
Depreciation | 79.6 | 76.9 | $ 77.1 |
Equipment | |||
Property and Equipment | |||
Property and equipment, gross | 591.4 | 656.8 | |
Leasehold improvements | |||
Property and Equipment | |||
Property and equipment, gross | $ 159.2 | 158.6 | |
Buildings | |||
Property and Equipment | |||
Property and equipment useful life | 30 years | ||
Property and Equipment | |||
Property and equipment, gross | $ 0.4 | 88.6 | |
Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment, gross | 49.4 | 51.6 | |
Land and improvements | |||
Property and Equipment | |||
Property and equipment, gross | 17 | ||
Projects in process | |||
Property and Equipment | |||
Property and equipment, gross | $ 3 | $ 0.2 | |
Minimum | Equipment | |||
Property and Equipment | |||
Property and equipment useful life | 3 years | ||
Minimum | Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment useful life | 3 years | ||
Maximum | Equipment | |||
Property and Equipment | |||
Property and equipment useful life | 10 years | ||
Maximum | Furniture and fixtures | |||
Property and Equipment | |||
Property and equipment useful life | 10 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill | |||
Goodwill impairment charge | $ 0 | $ 0 | $ 464 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Components of Other Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Intangible Assets | |||
Amortization expense | $ 178.1 | $ 187.8 | $ 185.8 |
Initial Cost | 1,456.4 | 1,645.8 | |
Net of Accumulated Amortization | 494.9 | 598.2 | |
Estimated future aggregate amortization expense | |||
Estimated future aggregate amortization expense, 2020 | 146.6 | ||
Estimated future aggregate amortization expense, 2021 | 113.9 | ||
Estimated future aggregate amortization expense, 2022 | 75.9 | ||
Estimated future aggregate amortization expense, 2023 | 55.9 | ||
Estimated future aggregate amortization expense, 2024 | 38.6 | ||
Estimated future aggregate amortization expense, thereafter | 32.8 | ||
Acquired contracts | |||
Other Intangible Assets | |||
Initial Cost | 584.2 | 598.1 | |
Net of Accumulated Amortization | 124.1 | 171.2 | |
Capitalized contract costs | |||
Other Intangible Assets | |||
Initial Cost | 510.3 | 536.5 | |
Net of Accumulated Amortization | 271.7 | 318.9 | |
Internal use software | |||
Other Intangible Assets | |||
Initial Cost | 281.2 | 447.3 | |
Net of Accumulated Amortization | 54.7 | 80.6 | |
Acquired trademarks | |||
Other Intangible Assets | |||
Initial Cost | 30.1 | 32.5 | |
Net of Accumulated Amortization | 13.2 | 15.5 | |
Projects in process | |||
Other Intangible Assets | |||
Initial Cost | 31.2 | 12 | |
Net of Accumulated Amortization | 31.2 | 12 | |
Other intangibles | |||
Other Intangible Assets | |||
Initial Cost | $ 19.4 | $ 19.4 | |
Minimum | Internal use software | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 3 years | ||
Maximum | Internal use software | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 7 years | ||
Weighted Average | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 8 years 1 month 6 days | ||
Weighted Average | Acquired contracts | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 11 years 6 months | ||
Weighted Average | Capitalized contract costs | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 6 years 2 months 12 days | ||
Weighted Average | Internal use software | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 3 years 9 months 18 days | ||
Weighted Average | Acquired trademarks | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 25 years 4 months 24 days | ||
Weighted Average | Other intangibles | |||
Other Intangible Assets | |||
Amortization period of intangible assets | 4 years 3 months 18 days |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Advertising Costs | |||
Advertising costs | $ 209.1 | $ 180.9 | $ 168.3 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Derivatives (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Derivatives | |
Fair value hedges outstanding | $ 0 |
Minimum | Uncollected settlement assets and obligations | |
Derivatives | |
Derivative contracts maturity range | 2 days |
Maximum | Uncollected settlement assets and obligations | |
Derivatives | |
Derivative contracts maturity range | 1 month |
Maximum | Foreign currency denominated cash and other asset and other liability positions | |
Derivatives | |
Derivative contracts maturity range | 1 year |
Business Solutions | Maximum | Cross Currency | |
Derivatives | |
Derivative contracts maturity range | 1 year |
Summary of Significant Accou_12
Summary of Significant Accounting Policies - Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2018 | Dec. 31, 2019 | |
Recently Adopted Accounting Pronouncements | ||
Reclassification of Tax Act effects into Accumulated Deficit | $ 31.4 | |
ASU 2016-02 | ||
Recently Adopted Accounting Pronouncements | ||
Change in accounting principle due to adopted Accounting Standards Update | true | |
Practical expedients related to Lease disclosures | true | |
Transition option elected | Modified Retrospective | |
ASU 2016-13 | ||
Recently Adopted Accounting Pronouncements | ||
Change in accounting principle due to adopted Accounting Standards Update | false |
Revenue - Narrative - (Details)
Revenue - Narrative - (Details) $ in Millions | 12 Months Ended | |
Dec. 31, 2019USD ($)item | Dec. 31, 2018USD ($) | |
Revenue | ||
Revenues from contracts with customers | $ | $ 5,033.2 | $ 5,382.6 |
Consumer money transfers | ||
Revenue | ||
Revenues from contracts with customers | $ | $ 4,304.3 | 4,384 |
Number of performance obligations | item | 1 | |
Number of integrated services involved in a transaction | item | 1 | |
Consumer bill payments | ||
Revenue | ||
Revenues from contracts with customers | $ | $ 357.5 | $ 621.5 |
Number of integrated services involved in a transaction | item | 1 |
Revenue - Disaggregation of rev
Revenue - Disaggregation of revenue - (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | |||||||||||
Revenues from contracts with customers | $ 5,033.2 | $ 5,382.6 | |||||||||
Other revenues | 258.9 | 207.3 | |||||||||
Revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | 5,292.1 | 5,589.9 | $ 5,524.3 |
Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 4,304.3 | 4,384 | |||||||||
Other revenues | 103.5 | 69.6 | |||||||||
Revenues | 4,407.8 | 4,453.6 | |||||||||
Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 296.1 | 302.1 | |||||||||
Other revenues | 92.7 | 84.7 | |||||||||
Revenues | 388.8 | 386.8 | |||||||||
Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 357.5 | 621.5 | |||||||||
Other revenues | 37.3 | 30.8 | |||||||||
Revenues | 394.8 | 652.3 | |||||||||
Other services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 75.3 | 75 | |||||||||
Other revenues | 25.4 | 22.2 | |||||||||
Revenues | 100.7 | 97.2 | |||||||||
Other services | Speedpay | Divestitures | |||||||||||
Revenue | |||||||||||
Revenues | 125.4 | 352 | $ 368.3 | ||||||||
North America | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 2,027.8 | 2,251.2 | |||||||||
North America | Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 1,653.5 | 1,632.3 | |||||||||
North America | Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 95.4 | 97.6 | |||||||||
North America | Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 223 | 463.9 | |||||||||
North America | Other services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 55.9 | 57.4 | |||||||||
Europe and Russia/CIS | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 1,484.5 | 1,536.5 | |||||||||
Europe and Russia/CIS | Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 1,350.1 | 1,399.5 | |||||||||
Europe and Russia/CIS | Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 127.1 | 130 | |||||||||
Europe and Russia/CIS | Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 3.2 | 3.1 | |||||||||
Europe and Russia/CIS | Other services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 4.1 | 3.9 | |||||||||
Middle East, Africa, and South Asia | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 644.2 | 656.2 | |||||||||
Middle East, Africa, and South Asia | Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 642 | 654.4 | |||||||||
Middle East, Africa, and South Asia | Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 1.8 | 1.5 | |||||||||
Middle East, Africa, and South Asia | Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 0.4 | 0.3 | |||||||||
Latin America and the Caribbean | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 543.3 | 562.7 | |||||||||
Latin America and the Caribbean | Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 395.2 | 393.2 | |||||||||
Latin America and the Caribbean | Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 3.4 | 3.1 | |||||||||
Latin America and the Caribbean | Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 129.4 | 152.7 | |||||||||
Latin America and the Caribbean | Other services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 15.3 | 13.7 | |||||||||
East Asia and Oceania | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 333.4 | 376 | |||||||||
East Asia and Oceania | Consumer money transfers | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 263.5 | 304.6 | |||||||||
East Asia and Oceania | Foreign exchange and payment services | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | 68.4 | 69.9 | |||||||||
East Asia and Oceania | Consumer bill payments | |||||||||||
Revenue | |||||||||||
Revenues from contracts with customers | $ 1.5 | $ 1.5 |
Restructuring-Related Expense_3
Restructuring-Related Expenses and Business Transformation Expenses - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 24 Months Ended | ||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2020 | |
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | $ 16.6 | $ 91.5 | $ 7.4 | $ 115.5 | $ 94.4 | ||
Cash payment | 38.2 | $ 32.3 | $ 77.3 | ||||
Severance and Related Employee Benefits | |||||||
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | 98 | ||||||
Cash payment | 28.6 | ||||||
Facility Relocations and Closures, Consulting, and Other | |||||||
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | 17.5 | ||||||
Cash payment | $ 9.6 | ||||||
Forecast | |||||||
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | $ 150 | ||||||
Forecast | Severance and Related Employee Benefits | |||||||
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | 110 | ||||||
Forecast | Facility Relocations and Closures, Consulting, and Other | |||||||
Restructuring-Related Expenses | |||||||
Restructuring-related expenses and business transformation expenses | $ 40 |
Restructuring-Related Expense_4
Restructuring-Related Expenses and Business Transformation Expenses - Accruals (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summary of activity for expenses related to the restructuring accruals | ||||||
Expenses | $ 16.6 | $ 91.5 | $ 7.4 | $ 115.5 | $ 94.4 | |
Cash payments | (38.2) | $ (32.3) | $ (77.3) | |||
Non-cash benefits/(charges) | (4) | |||||
Ending balance | 73.3 | 73.3 | ||||
Severance and Related Employee Benefits | ||||||
Summary of activity for expenses related to the restructuring accruals | ||||||
Expenses | 98 | |||||
Cash payments | (28.6) | |||||
Non-cash benefits/(charges) | 1.8 | |||||
Ending balance | 71.2 | 71.2 | ||||
Facility Relocations and Closures, Consulting, and Other | ||||||
Summary of activity for expenses related to the restructuring accruals | ||||||
Expenses | 17.5 | |||||
Cash payments | (9.6) | |||||
Non-cash benefits/(charges) | (5.8) | |||||
Ending balance | $ 2.1 | $ 2.1 |
Restructuring-Related Expense_5
Restructuring-Related Expenses and Business Transformation Expenses - Expenses (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2017 | |
Restructuring-related expenses | |||||
Expenses | $ 16.6 | $ 91.5 | $ 7.4 | $ 115.5 | $ 94.4 |
Total expenses, net of tax | 90 | 63.3 | |||
Cost of services | |||||
Restructuring-related expenses | |||||
Expenses | 39.8 | 35.7 | |||
Selling, general, and administrative | |||||
Restructuring-related expenses | |||||
Expenses | $ 75.7 | $ 58.7 |
Divestitures, Business Combin_3
Divestitures, Business Combinations, and Goodwill (Details) - USD ($) $ in Millions | May 09, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Divestitures and Assets Held For Sale | ||||
Gain on sale | $ 524.6 | |||
Speedpay | Divestitures | ||||
Divestitures and Assets Held For Sale | ||||
Consideration from sale of business | $ 750 | |||
Speedpay | Divestitures | Other services | ||||
Divestitures and Assets Held For Sale | ||||
Gain on sale | $ 523 | |||
Revenues | 125.4 | $ 352 | $ 368.3 | |
Operating expenses | $ 98.2 | $ 251.2 | $ 246 |
Divestitures, Business Combin_4
Divestitures, Business Combinations, and Goodwill - Narrative (Details) - USD ($) $ in Millions | Nov. 06, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Mar. 31, 2018 |
Goodwill Impairment Charge | |||||
Goodwill impairment charge | $ 0 | $ 0 | $ 464 | ||
Business Combinations | |||||
Goodwill | 2,566.6 | 2,725 | 2,727.9 | ||
Opus Software Technologies Private Limited | |||||
Business Combinations | |||||
Total consideration | $ 25.3 | ||||
Goodwill | $ 22 | ||||
Business Solutions | |||||
Goodwill Impairment Charge | |||||
Goodwill impairment charge | 464 | ||||
Business Combinations | |||||
Goodwill | $ 532 | $ 532 | $ 532 |
Divestitures, Business Combin_5
Divestitures, Business Combinations, and Goodwill - Changes to Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Changes to goodwill | ||
Goodwill, beginning balance | $ 2,725 | $ 2,727.9 |
Purchase accounting adjustments | (0.3) | |
Currency translation | (2.6) | |
Divestitures | (158.4) | |
Goodwill, ending balance | 2,566.6 | 2,725 |
Consumer-to-Consumer | ||
Changes to goodwill | ||
Goodwill, beginning balance | 1,980.7 | 1,981 |
Purchase accounting adjustments | (0.3) | |
Goodwill, ending balance | 1,980.7 | 1,980.7 |
Business Solutions | ||
Changes to goodwill | ||
Goodwill, beginning balance | 532 | 532 |
Goodwill, ending balance | 532 | 532 |
Other | ||
Changes to goodwill | ||
Goodwill, beginning balance | 212.3 | 214.9 |
Currency translation | (2.6) | |
Divestitures | (158.4) | |
Goodwill, ending balance | $ 53.9 | $ 212.3 |
Divestitures, Business Combin_6
Divestitures, Business Combinations, and Goodwill - Accumulated Impairment Losses (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Divestitures, Business Combinations, and Goodwill | |||
Goodwill, gross | $ 3,030.6 | $ 3,189 | $ 3,191.9 |
Accumulated impairment losses | (464) | (464) | (464) |
Goodwill, net | $ 2,566.6 | $ 2,725 | $ 2,727.9 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) € in Millions, $ in Millions | Jan. 19, 2020 | Jan. 04, 2018USD ($) | Nov. 06, 2017defendant | May 03, 2017lawsuit | Feb. 22, 2017lawsuit | Jan. 31, 2017USD ($)stateitem | Mar. 31, 2015USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2017USD ($) | Jan. 04, 2018EUR (€) | Apr. 12, 2017state | Mar. 31, 2017item | Feb. 13, 2017item |
Commitments and Contingencies | |||||||||||||
Letters of credit outstanding and bank guarantees | $ 335 | ||||||||||||
Maximum maturity year for letters of credit | 2024 | ||||||||||||
Letters of credit renewal option | 1 year | ||||||||||||
Joint Settlement Agreements | |||||||||||||
Commitments and Contingencies | |||||||||||||
State attorneys general payment | $ 8 | ||||||||||||
NYDFS Consent Order | |||||||||||||
Commitments and Contingencies | |||||||||||||
State attorneys general payment | 60 | ||||||||||||
Damages awarded | $ 60 | ||||||||||||
Pending Litigation | |||||||||||||
Commitments and Contingencies | |||||||||||||
Range of possible loss, portion not accrued | $ 30 | ||||||||||||
Pending Litigation | Lawrence Henry Smallen and Laura Anne Smallen Revocable Living Trust | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of purported class action lawsuits | lawsuit | 2 | ||||||||||||
Number of claims consolidated | lawsuit | 2 | ||||||||||||
Pending Litigation | Lawrence Henry Smallen and Laura Anne Smallen Revocable Living Trust | Executive Officer | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of defendants | defendant | 2 | ||||||||||||
Number of defendants voluntarily dismissed | defendant | 1 | ||||||||||||
Pending Litigation | National Court of Spain | |||||||||||||
Commitments and Contingencies | |||||||||||||
Guaranty liabilities | € | € 23 | ||||||||||||
Pending Litigation | National Court of Spain | Former Agent | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of agents | item | 98 | ||||||||||||
Settled Litigation | Joint Settlement Agreements | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of state attorneys general | state | 49 | 1 | |||||||||||
Count- criminal information | item | 2 | ||||||||||||
Compensation payment | $ 586 | ||||||||||||
State attorneys general payment | $ 5 | ||||||||||||
Period to retain an independent compliance auditor | 3 years | ||||||||||||
Civil penalty assessed by the FinCEN Agreement | $ 184 | ||||||||||||
Settled Litigation | Joint Settlement Agreements | Subsequent Event | |||||||||||||
Commitments and Contingencies | |||||||||||||
Period from the expiration to file for dismissal of charges | 90 days | ||||||||||||
Settled Litigation | Northern District of Illinois | |||||||||||||
Commitments and Contingencies | |||||||||||||
Litigation settlement awarded to other party | $ 8.5 | ||||||||||||
Settled Litigation | NYDFS Consent Order | |||||||||||||
Commitments and Contingencies | |||||||||||||
Damages awarded | $ 60 | ||||||||||||
Settled Litigation | NYDFS Consent Order | Current Agent | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of agents | item | 1 | ||||||||||||
Settled Litigation | NYDFS Consent Order | Former Agent | |||||||||||||
Commitments and Contingencies | |||||||||||||
Number of agents | item | 2 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Related Party Transactions | |||
Commission expense | $ 57.1 | $ 57.6 | $ 65.9 |
Equity Method Investee | |||
Related Party Transactions | |||
Commission expense | $ 57.1 | $ 57.6 | $ 65.9 |
Investment Securities - Compone
Investment Securities - Components of Investment Securities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investment Securities | |||
Variable rate demand notes, maximum maturity year | 2051 | ||
Proceeds from sale and maturity of available-for-sale securities | $ 5,400 | $ 7,700 | $ 7,900 |
Cash and cash equivalents | |||
Amortized Cost | 1,450.5 | 973.4 | |
Settlement assets: | |||
Amortized Cost | 1,666.8 | 1,212 | |
Fair Value | 1,698.4 | 1,210.6 | |
Gross Unrealized Gains | 32.2 | 6.1 | |
Gross Unrealized Losses | (0.6) | (7.5) | |
Net Unrealized Gains/ (Losses) | 31.6 | (1.4) | |
Other assets: | |||
Amortized Cost | 1,691.4 | 1,295.8 | |
Fair Value | 1,723 | 1,294.4 | |
Gross Unrealized Gains | 32.2 | 6.1 | |
Gross Unrealized Losses | (0.6) | (7.5) | |
Net Unrealized Gains/ (Losses) | 31.6 | (1.4) | |
Money market funds | |||
Cash and cash equivalents | |||
Amortized Cost | 27 | ||
Fair Value | 27 | ||
Settlement assets: | |||
Amortized Cost | 23.9 | ||
Fair Value | 23.9 | ||
Money market funds | Settlement Assets | |||
Cash and cash equivalents | |||
Amortized Cost | 24.6 | ||
Fair Value | 24.6 | ||
State and municipal debt securities | |||
Settlement assets: | |||
Amortized Cost | 1,227.4 | 963.4 | |
Fair Value | 1,257.8 | 962.7 | |
Gross Unrealized Gains | 31 | 6.1 | |
Gross Unrealized Losses | (0.6) | (6.8) | |
Net Unrealized Gains/ (Losses) | 30.4 | (0.7) | |
State and municipal variable-rate demand notes | |||
Settlement assets: | |||
Amortized Cost | 276.1 | 168.7 | |
Fair Value | 276.1 | 168.7 | |
United States government agency mortgage-backed securities | |||
Settlement assets: | |||
Amortized Cost | 66.3 | ||
Fair Value | 67.2 | ||
Gross Unrealized Gains | 0.9 | ||
Net Unrealized Gains/ (Losses) | 0.9 | ||
Corporate debt securities | |||
Settlement assets: | |||
Amortized Cost | 52.3 | ||
Fair Value | 52.4 | ||
Gross Unrealized Gains | 0.1 | ||
Net Unrealized Gains/ (Losses) | 0.1 | ||
Other United States government agency debt securities | |||
Settlement assets: | |||
Amortized Cost | 34.9 | ||
Fair Value | 34.9 | ||
Corporate and other debt securities | |||
Settlement assets: | |||
Amortized Cost | 70 | ||
Fair Value | 69.5 | ||
Gross Unrealized Losses | (0.5) | ||
Net Unrealized Gains/ (Losses) | (0.5) | ||
United States Treasury securities | |||
Settlement assets: | |||
Amortized Cost | 9.8 | 9.9 | |
Fair Value | 10 | 9.7 | |
Gross Unrealized Gains | 0.2 | ||
Gross Unrealized Losses | (0.2) | ||
Net Unrealized Gains/ (Losses) | $ 0.2 | (0.2) | |
Foreign corporate debt securities | |||
Other assets: | |||
Amortized Cost | 32.9 | ||
Fair Value | $ 32.9 |
Investment Securities - Contrac
Investment Securities - Contractual Maturities of Debt Securities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value | ||
Due within 1 year | $ 182.5 | |
Due after 1 year through 5 years | 572.2 | |
Due after 5 years through 10 years | 525.3 | |
Due after 10 years | 418.4 | |
Total investment securities | 1,698.4 | $ 1,210.6 |
State and municipal variable-rate demand notes | ||
Fair Value | ||
Due within 1 year | 7.6 | |
Due after 1 year through 5 years | 17.9 | |
Due after 5 years through 10 years | 11 | |
Due after 10 years | 239.6 | |
Total investment securities | $ 276.1 | $ 168.7 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value of Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Assets: | ||
Settlement assets | $ 3,296.7 | $ 3,813.8 |
Derivatives | 204.5 | 245.5 |
Liabilities: | ||
Derivatives | 159.5 | 176.2 |
Money market funds | ||
Assets: | ||
Cash | 27 | |
Recurring | ||
Assets: | ||
Derivatives | 204.5 | 245.5 |
Total assets | 1,927.5 | 1,507 |
Liabilities: | ||
Derivatives | 159.5 | 176.2 |
Total liabilities | 159.5 | 176.2 |
Recurring | Money market funds | ||
Assets: | ||
Cash | 27 | |
Settlement assets | 24.6 | 23.9 |
Recurring | State and municipal debt securities | ||
Assets: | ||
Settlement assets | 1,257.8 | 962.7 |
Recurring | State and municipal variable-rate demand notes | ||
Assets: | ||
Settlement assets | 276.1 | 168.7 |
Recurring | United States government agency mortgage-backed securities | ||
Assets: | ||
Settlement assets | 67.2 | |
Recurring | Corporate and other debt securities | ||
Assets: | ||
Settlement assets | 69.5 | |
Recurring | Other United States government agency debt securities | ||
Assets: | ||
Settlement assets | 34.9 | |
Recurring | Corporate and other debt securities | ||
Assets: | ||
Settlement assets | 52.4 | |
Recurring | United States Treasury securities | ||
Assets: | ||
Settlement assets | 10 | 9.7 |
Recurring | Level 1 | ||
Assets: | ||
Total assets | 34.6 | 60.6 |
Recurring | Level 1 | Money market funds | ||
Assets: | ||
Cash | 27 | |
Settlement assets | 24.6 | 23.9 |
Recurring | Level 1 | United States Treasury securities | ||
Assets: | ||
Settlement assets | 10 | 9.7 |
Recurring | Level 2 | ||
Assets: | ||
Derivatives | 204.5 | 245.5 |
Total assets | 1,892.9 | 1,446.4 |
Liabilities: | ||
Derivatives | 159.5 | 176.2 |
Total liabilities | 159.5 | 176.2 |
Recurring | Level 2 | State and municipal debt securities | ||
Assets: | ||
Settlement assets | 1,257.8 | 962.7 |
Recurring | Level 2 | State and municipal variable-rate demand notes | ||
Assets: | ||
Settlement assets | 276.1 | 168.7 |
Recurring | Level 2 | United States government agency mortgage-backed securities | ||
Assets: | ||
Settlement assets | 67.2 | |
Recurring | Level 2 | Corporate and other debt securities | ||
Assets: | ||
Settlement assets | $ 69.5 | |
Recurring | Level 2 | Other United States government agency debt securities | ||
Assets: | ||
Settlement assets | 34.9 | |
Recurring | Level 2 | Corporate and other debt securities | ||
Assets: | ||
Settlement assets | $ 52.4 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Adjustments | ||
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | $ 0 | $ 0 |
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount | 0 | 0 |
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount | 0 | 0 |
Fair Value, Liabilities, Level 2 to Level 1 Transfers, Amount | 0 | 0 |
Carrying Value | ||
Other Fair Value Measurements | ||
Borrowings | 3,229.3 | 3,433.7 |
Level 2 | Fair Value | ||
Other Fair Value Measurements | ||
Borrowings | 3,372.2 | 3,394.6 |
Foreign corporate debt securities | Carrying Value | ||
Other Fair Value Measurements | ||
Carrying value of foreign corporate debt securities | 32.9 | |
Foreign corporate debt securities | Level 2 | Fair Value | ||
Other Fair Value Measurements | ||
Fair value of foreign corporate debt securities | 32.9 | |
Non-recurring | ||
Fair Value Adjustments | ||
Non-recurring asset fair value adjustments | 0 | 0 |
Non-recurring liability fair value adjustments | $ 0 | $ 0 |
Other Assets and Other Liabil_3
Other Assets and Other Liabilities - Summary (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Other assets: | ||
Derivatives | $ 204.5 | $ 245.5 |
ROU asset | 199.7 | |
Prepaid expenses | 102.4 | 101.3 |
Amounts advanced to agents, net of discounts | 96.4 | 57.6 |
Equity method investments | 33 | 31.3 |
Other | 126.9 | 180.3 |
Total other assets | 762.9 | 616 |
Other liabilities: | ||
Operating lease liabilities | 242.3 | |
Derivatives | 159.5 | 176.2 |
Pension obligations | 11.4 | 16 |
Other | 85.1 | 86.9 |
Total other liabilities | 498.3 | $ 279.1 |
Assets held for sale, net | 49.3 | |
Former Headquarters | ||
Other liabilities: | ||
Assets held for sale, net | $ 49.3 |
Income Taxes - Components of Pr
Income Taxes - Components of Pre-Tax Income (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Components of pre-tax income | |||||||||||
Domestic | $ 434.7 | $ (11.4) | $ (238.8) | ||||||||
Foreign | 886.7 | 1,002.8 | 586.3 | ||||||||
Income before income taxes | $ 197.5 | $ 162.2 | $ 745.6 | $ 216.1 | $ 235 | $ 266.4 | $ 255.5 | $ 234.5 | $ 1,321.4 | $ 991.4 | $ 347.5 |
Geographic Concentration Risk | |||||||||||
Components of pre-tax income | |||||||||||
Percent of pre-tax income derived from foreign sources | 67.00% | 101.00% | 169.00% |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Provision for income taxes | |||||||||||
Federal | $ 153.7 | $ 62.9 | $ 848.5 | ||||||||
State and local | 22.9 | 0.6 | 5.4 | ||||||||
Foreign | 86.5 | 76 | 50.7 | ||||||||
Provision for income taxes | $ 62.1 | $ 27.2 | $ 130.8 | $ 43 | $ 22.9 | $ 57.8 | $ 37.9 | $ 20.9 | $ 263.1 | $ 139.5 | 904.6 |
NYDFS Consent Order | |||||||||||
Provision for income taxes | |||||||||||
Provision for income taxes | 0 | ||||||||||
Damages awarded | $ 60 |
Income Taxes - Effective Tax Ra
Income Taxes - Effective Tax Rates (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective tax rate reconciliation | |||
Federal statutory rate | 21.00% | 21.00% | 35.00% |
State income taxes, net of federal income tax benefits | 1.40% | 0.40% | 1.70% |
Foreign rate differential, net of United States tax paid on foreign earnings (2.3%, 4.9%, and 1.1%, respectively | (5.50%) | (8.20%) | (69.30%) |
Divestitures | 2.40% | ||
Tax Act impact | 2.3 | 251.5 | |
NYDFS Consent Order impact | 6.00% | ||
Goodwill impairment | 46.70% | ||
Base erosion anti-abuse tax (BEAT) | 3.00% | ||
Lapse of statute of limitations | (0.50%) | (2.20%) | (10.00%) |
Valuation allowances | 0.10% | 0.80% | |
Other | 1.00% | (2.20%) | (2.10%) |
Effective tax rate | 19.90% | 14.10% | 260.30% |
US tax paid on foreign earnings | 2.30% | 4.90% | 1.10% |
Income Taxes - Current and Defe
Income Taxes - Current and Deferred Components of Provision for Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||||||||||
Federal | $ 169.4 | $ 69.2 | $ 774.4 | ||||||||
State and local | 18.1 | 1 | |||||||||
Foreign | 100.1 | 85.4 | 59.7 | ||||||||
Total current taxes | 287.6 | 154.6 | 835.1 | ||||||||
Deferred: | |||||||||||
Federal | (15.7) | (6.3) | 74.1 | ||||||||
State and local | 4.8 | 0.6 | 4.4 | ||||||||
Foreign | (13.6) | (9.4) | (9) | ||||||||
Total deferred taxes | (24.5) | (15.1) | 69.5 | ||||||||
Provision for income taxes | $ 62.1 | $ 27.2 | $ 130.8 | $ 43 | $ 22.9 | $ 57.8 | $ 37.9 | $ 20.9 | $ 263.1 | $ 139.5 | $ 904.6 |
Income Taxes - Deferred Taxes (
Income Taxes - Deferred Taxes (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets related to: | ||
Reserves, accrued expenses and employee-related items | $ 38.3 | $ 42.6 |
Lease liabilities | 28.1 | |
Tax attribute carryovers | 31.7 | 29.9 |
Pension obligations | 4 | 4.8 |
Intangibles, property and equipment | 13.6 | 8.5 |
Other | 5.3 | 5.3 |
Valuation allowance | (19.1) | (15.7) |
Total deferred tax assets | 101.9 | 75.4 |
Deferred tax liabilities related to: | ||
Intangibles, property and equipment | 214.8 | 228 |
Lease right-of-use assets | 18.7 | |
Other | 6.9 | |
Total deferred tax liabilities | 240.4 | 228 |
Net deferred tax liability | 138.5 | 152.6 |
Other assets | ||
Deferred tax liabilities related to: | ||
Gross deferred tax assets | $ 13.6 | $ 8.5 |
Income Taxes - Tax Act (Details
Income Taxes - Tax Act (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tax and Jobs Act of 2017 | |||
Provisional liability related to accumulated foreign earnings | $ 493 | ||
Deferred Tax Liabilities, Undistributed Foreign Earnings | 668 | $ 800 | |
Payment of deferred tax liabilities undistributed foreign earnings | $ 64 | $ 64 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tax Contingency Reserves | |||
Total tax contingency reserve | $ 309 | ||
Reconciliation of Unrecognized Tax Benefits | |||
Balance at beginning of period | 295 | $ 329 | |
Increase related to current period tax positions | 5.2 | 4 | |
Increase related to prior period tax positions | 0.8 | 0.4 | |
Decrease related to prior period tax positions | (1.6) | (18.5) | |
Decrease due to lapse of applicable statute of limitations | (5.3) | (17.7) | |
Increase/(decrease) due to effects of foreign currency exchange rates | (0.2) | (2.2) | |
Balance at end of period | 293.9 | 295 | $ 329 |
Unrecognized Tax Benefits | |||
Unrecognized tax benefits that, if recognized, would affect the effective tax rate | 283.4 | 284.2 | |
Interest and penalties, recognized | 6 | (0.7) | $ 2.2 |
Interest and penalties, accrued | 27.1 | 23.9 | |
Reasonably possible decrease to the Company's total unrecognized tax benefits during the next 12 months | $ 4 | ||
Cash payments made to date as a result of the IRS Agreement | $ 120 |
Employee Benefit Plans - Narrat
Employee Benefit Plans - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Contribution Plans | ||||
Total expenses | $ 20 | $ 20 | $ 19.2 | |
Defined Benefit Plan | ||||
Fair value of plan assets | 237.1 | 234.8 | ||
Benefit obligation | $ 248.5 | $ 250.8 | ||
Discount rate assumption | 2.66% | 3.79% | ||
Unfunded pension obligation | $ (11.4) | $ (16) | ||
Net Periodic Benefit Cost | ||||
Net periodic benefit cost | 4.1 | 3.3 | $ 2.4 | |
Company contributions to the Plan | 0 | $ 0 | ||
Estimated future company contributions in 2020 | 0 | |||
Estimated Undiscounted Future Benefit Payments | ||||
Expected future benefit payments, 2020 | 27.7 | |||
Expected future benefit payments, 2021 | 25.9 | |||
Expected future benefit payments, 2022 | 24.2 | |||
Expected future benefit payments, 2023 | 22.5 | |||
Expected future benefit payments, 2024 | 20.9 | |||
Expected future benefit payments, 2025 through 2029 | $ 81.4 | |||
Forecast | ||||
Net Periodic Benefit Cost | ||||
Expected long-term return on plan assets assumption | 6.25% | |||
Fixed Income | ||||
Defined Benefit Plan | ||||
Target allocation | 60.00% | |||
Equity Investments | ||||
Defined Benefit Plan | ||||
Target allocation | 20.00% | |||
Alternative Investments | ||||
Defined Benefit Plan | ||||
Target allocation | 20.00% |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Leases | |||
ROU asset | $ 199.7 | ||
Balance sheet location of ROU asset | us-gaap:OtherAssets | ||
Lease liability | $ 242.3 | ||
Balance sheet location of lease liability | us-gaap:OtherLiabilities | ||
Operating lease costs | $ 56.7 | ||
Total rent expense under operating leases, net of sublease income | $ 59.5 | $ 51.1 | |
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||
Minimum | |||
Leases | |||
Lease terms | 1 year | ||
Maximum | |||
Leases | |||
Lease terms | 11 years | ||
Lease extension terms | 10 years |
Leases - Weighted Average Lease
Leases - Weighted Average Lease Terms and Discount Rate (Details) | Dec. 31, 2019 |
Weighted Average Lease Terms and Discount Rates | |
Weighted average remaining lease term | 7 years 7 months 6 days |
Weighted average discount rate | 6.50% |
Leases - Maturities (Details)
Leases - Maturities (Details) $ in Millions | Dec. 31, 2019USD ($) |
Maturities of Operating Lease Liabilities | |
Due within 1 year | $ 53.2 |
Due after 1 year through 2 years | 45.2 |
Due after 2 years through 3 years | 38.5 |
Due after 3 years through 4 years | 32.6 |
Due after 4 years through 5 years | 30.5 |
Due after 5 years | 102.5 |
Total future minimum lease payments | 302.5 |
Less imputed interest | (60.2) |
Operating lease liabilities | $ 242.3 |
Operating Lease Commitments - S
Operating Lease Commitments - Summary (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Leases | ||
Total rent expense under operating leases, net of sublease income | $ 59.5 | $ 51.1 |
Minimum Aggregate Rental Commitments | ||
2019 | 51.6 | |
2020 | 44.1 | |
2021 | 35.4 | |
2022 | 31.4 | |
2023 | 25.2 | |
Thereafter | 112.6 | |
Total future minimum lease payments | $ 300.3 |
Stockholders' Equity_(Deficit_2
Stockholders' Equity/(Deficit) - Amounts Reclassified from AOCL (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investment Securities | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, net of tax | $ 0.5 | $ (0.3) | $ 1.5 |
Hedging Activities | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, net of tax | 14.1 | (16.3) | 2.7 |
Defined benefit plans | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, net of tax | (8.4) | (9.1) | (7.2) |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, net of tax | 6.2 | (25.7) | (3) |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Investment Securities | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, Provision for income taxes | (0.1) | 0.1 | (0.9) |
Reclassification from AOCL, net of tax | 0.5 | (0.3) | 1.5 |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Investment Securities | Revenues | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, before tax | 0.6 | (0.4) | 2.4 |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Hedging Activities | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, Provision for income taxes | (0.1) | 0.7 | 1.2 |
Reclassification from AOCL, net of tax | 14.1 | (16.3) | 2.7 |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Hedging Activities | Foreign currency contracts | Revenues | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, before tax | 14.2 | (14.9) | 4.8 |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Hedging Activities | Interest rate contracts | Interest Expense | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, before tax | (2.1) | (3.3) | |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Defined benefit plans | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, Provision for income taxes | 2.4 | 2.6 | 4.1 |
Reclassification from AOCL, net of tax | (8.4) | (9.1) | (7.2) |
Reclassification out of Accumulated Other Comprehensive Income (Loss) | Defined benefit plans | Other income, net | |||
Accumulated other comprehensive income (loss) | |||
Reclassification from AOCL, before tax | $ (10.8) | $ (11.7) | $ (11.3) |
Stockholders' Equity_(Deficit_3
Stockholders' Equity/(Deficit) - Components of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | $ (491.4) | $ (309.8) | $ (491.4) | $ 902.2 |
Net foreign currency translation adjustments | (19.5) | (6.2) | ||
Reclassification of Tax Act effects into "Accumulated deficit" | (31.4) | |||
Ending balance | (39.5) | (309.8) | (491.4) | |
Investment Securities | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | 2.7 | (1.1) | 2.7 | (3.8) |
Unrealized gains/(losses) | 33.6 | (5.9) | 12.6 | |
Tax benefit/(expense) | (7.3) | 1.3 | (4.6) | |
Amounts reclassified from AOCL into earnings, net of tax | (0.5) | 0.3 | (1.5) | |
Reclassification of Tax Act effects into "Accumulated deficit" | 0.5 | |||
Ending balance | 24.7 | (1.1) | 2.7 | |
Hedging Activities | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | (40.6) | 7.4 | (40.6) | 33.8 |
Unrealized gains/(losses) | 2 | 35.6 | (73.9) | |
Tax benefit/(expense) | 1.1 | (1.6) | 2.2 | |
Amounts reclassified from AOCL into earnings, net of tax | (14.1) | 16.3 | (2.7) | |
Reclassification of Tax Act effects into "Accumulated deficit" | (2.3) | |||
Ending balance | (3.6) | 7.4 | (40.6) | |
Foreign Currency Translation | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | (76.9) | (101.2) | (76.9) | (70.7) |
Tax benefit/(expense) | 0.6 | |||
Net foreign currency translation adjustments | (19.5) | (6.8) | ||
Reclassification of Tax Act effects into "Accumulated deficit" | (4.8) | |||
Ending balance | (101.2) | (101.2) | (76.9) | |
Defined benefit plans | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | (113.1) | (136.1) | (113.1) | (122.1) |
Unrealized gains/(losses) | (2) | (9.3) | 2.3 | |
Tax benefit/(expense) | 0.8 | 2 | (0.5) | |
Amounts reclassified from AOCL into earnings, net of tax | 8.4 | 9.1 | 7.2 | |
Reclassification of Tax Act effects into "Accumulated deficit" | (24.8) | |||
Ending balance | (128.9) | (136.1) | (113.1) | |
Total AOCL | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Beginning balance | $ (227.9) | (231) | (227.9) | (162.8) |
Unrealized gains/(losses) | 33.6 | 20.4 | (59) | |
Tax benefit/(expense) | (5.4) | 1.7 | (2.3) | |
Amounts reclassified from AOCL into earnings, net of tax | (6.2) | 25.7 | 3 | |
Net foreign currency translation adjustments | (19.5) | (6.8) | ||
Reclassification of Tax Act effects into "Accumulated deficit" | (31.4) | |||
Ending balance | $ (209) | $ (231) | $ (227.9) |
Stockholders' Equity_(Deficit_4
Stockholders' Equity/(Deficit) - Cash Dividends Paid (Details) - USD ($) $ / shares in Units, $ in Millions | Feb. 11, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Cash Dividends Paid | ||||||||||||||||
Cash dividends paid | $ 340.8 | $ 341.7 | $ 325.6 | |||||||||||||
Common stock dividends (USD per share) | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.20 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.19 | $ 0.175 | $ 0.175 | $ 0.175 | $ 0.175 | ||||
Subsequent Event | ||||||||||||||||
Cash Dividends Paid | ||||||||||||||||
Common stock dividends (USD per share) | $ 0.225 |
Stockholders' Equity_(Deficit_5
Stockholders' Equity/(Deficit) - Share Repurchases (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Repurchases | |||
Stock repurchased and retired, publicly announced authorizations (shares) | 26.9 | 20.2 | 24.9 |
Stock repurchased and retired, publicly announced authorizations, value excluding commissions | $ 540 | $ 399.2 | $ 487 |
Stock repurchased and retired, publicly announced authorizations, average cost per share excluding commissions (USD per share) | $ 20.07 | $ 19.81 | $ 19.55 |
Authorized through December 31, 2021 | |||
Share Repurchases | |||
Remaining amount available under share repurchase authorization through December 31, 2021 | $ 1,000 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) - USD ($) $ in Millions | Nov. 15, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Derivatives | ||||
Accumulated other comprehensive pre-tax gain to be reclassified into revenue within the next 12 months | $ 5.7 | |||
Business Solutions | ||||
Derivatives | ||||
Foreign exchange revenues | $ 343.1 | $ 342.3 | $ 341 | |
Interest rate contracts | 5.253% notes due 2020 | ||||
Derivatives | ||||
Cash payment received for terminated swap agreement | $ 0.9 | |||
Fair Value Hedges | Interest rate contracts | 5.253% notes due 2020 | ||||
Derivatives | ||||
Notional amounts | 175 | |||
Designated as hedges | Foreign currency contracts | ||||
Derivatives | ||||
Derivative policy - contract maturity period maximum | 36 months | |||
Derivative policy - targeted weighted-average maturity | 1 year | |||
Maximum remaining maturity of foreign currency derivatives | 24 months | |||
Derivative weighted-average maturity | 1 year | |||
Not designated as hedges | Foreign currency contracts | Business Solutions | ||||
Derivatives | ||||
Notional amounts | $ 7,500 | $ 6,000 | ||
Minimum | Uncollected settlement assets and obligations | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 2 days | |||
Maximum | Uncollected settlement assets and obligations | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 1 month | |||
Maximum | Foreign currency denominated cash and other asset and other liability positions | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 1 year | |||
Maximum | Not designated as hedges | Uncollected settlement assets and obligations | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 1 month | |||
Maximum | Not designated as hedges | Foreign currency contracts | Business Solutions | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 1 year | |||
Maximum | Not designated as hedges | Foreign currency denominated cash and other asset and other liability positions | ||||
Derivatives | ||||
Foreign currency forward contracts maturity range | 1 year |
Derivatives - Notional Amounts
Derivatives - Notional Amounts of Foreign Currency Forward Contracts (Details) - Foreign currency contracts - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Other | ||
Notional amounts of foreign currency forward contracts | ||
Maximum individual currency exposure within various other currencies | $ 25 | $ 25 |
Designated as hedges | Euro | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 391.9 | 364.7 |
Designated as hedges | Canadian dollar | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 99 | 97.1 |
Designated as hedges | British pound | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 57.2 | 76.4 |
Designated as hedges | Australian dollar | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 36.1 | 45.3 |
Designated as hedges | Swiss franc | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 28.9 | |
Designated as hedges | Japanese yen | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 25.2 | |
Designated as hedges | Other | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 50.9 | 50.1 |
Not designated as hedges | Euro | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 289 | 274.4 |
Not designated as hedges | Indian rupee | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 61 | 37.2 |
Not designated as hedges | Canadian dollar | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 110.3 | 46 |
Not designated as hedges | British pound | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 78.1 | 81.5 |
Not designated as hedges | Mexican peso | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 52.3 | 34.2 |
Not designated as hedges | Australian dollar | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 35.2 | 39 |
Not designated as hedges | Brazilian real | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 32.5 | 35.8 |
Not designated as hedges | Japanese yen | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | 37.7 | 34.3 |
Not designated as hedges | Other | ||
Notional amounts of foreign currency forward contracts | ||
Notional amounts | $ 145.6 | $ 138.5 |
Derivatives - Fair Value of Der
Derivatives - Fair Value of Derivatives (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value of Derivatives | ||
Derivative Assets | $ 204.5 | $ 245.5 |
Derivative Liabilities | 159.5 | 176.2 |
Designated as hedges | ||
Fair Value of Derivatives | ||
Derivative Assets | 21 | 28.7 |
Derivative Liabilities | 4.8 | 2.8 |
Designated as hedges | Other assets | Interest rate contracts | ||
Fair Value of Derivatives | ||
Derivative Assets | 0.1 | |
Designated as hedges | Other assets | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Assets | 21 | 28.6 |
Designated as hedges | Other liabilities | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Liabilities | 4.8 | 2.8 |
Not designated as hedges | ||
Fair Value of Derivatives | ||
Derivative Assets | 183.5 | 216.8 |
Derivative Liabilities | 154.7 | 173.4 |
Not designated as hedges | Other assets | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Assets | 1.5 | 2.6 |
Not designated as hedges | Other liabilities | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Liabilities | 3.7 | 2.5 |
Not designated as hedges | Business Solutions | Other assets | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Assets | 182 | 214.2 |
Not designated as hedges | Business Solutions | Other liabilities | Foreign currency contracts | ||
Fair Value of Derivatives | ||
Derivative Liabilities | $ 151 | $ 170.9 |
Derivatives - Gross and Net Fai
Derivatives - Gross and Net Fair Value of Derivative Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Offsetting of Derivative Assets | ||
Gross Amounts of Recognized Assets | $ 95.3 | $ 162.6 |
Net Amounts Presented in the Consolidated Balance Sheets | 95.3 | 162.6 |
Derivatives Not Offset in the Consolidated Balance Sheets | (74.7) | (95.7) |
Net Amounts | 20.6 | 66.9 |
Derivatives that are not or may not be subject to master netting arrangement or similar agreement | 109.2 | 82.9 |
Total | 204.5 | 245.5 |
Offsetting of Derivative Liabilities | ||
Gross Amounts of Recognized Liabilities | 121.8 | 104.1 |
Net Amounts Presented in the Consolidated Balance Sheets | 121.8 | 104.1 |
Derivatives Not Offset in the Consolidated Balance Sheets | (74.7) | (95.7) |
Net Amounts | 47.1 | 8.4 |
Derivatives that are not or may not be subject to master netting arrangement or similar agreement | 37.7 | 72.1 |
Total | $ 159.5 | $ 176.2 |
Derivatives - Unrealized Gains_
Derivatives - Unrealized Gains/(Losses) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivatives | |||
Gain/(Loss) recognized in OCI on Foreign currency derivatives | $ 2 | $ 35.6 | $ (73.9) |
Gains excluded from effectiveness testing recognized in other comprehensive income | $ 1.5 | $ 0.1 | $ 0 |
Derivatives - Gains_(Losses) fr
Derivatives - Gains/(Losses) from Hedging Activities (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Gains/(Losses) from Derivatives | |||||||||||
Revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Interest expense | (152) | (149.6) | (142.1) | ||||||||
Other income, net | 8.5 | 14.1 | 8.9 | ||||||||
Fair Value Hedges | Interest rate contracts | Interest Expense | |||||||||||
Cash Flow and Fair Value Hedges | |||||||||||
Hedged items | (0.1) | 0.6 | 3.9 | ||||||||
Derivatives designated as hedging instruments | 1 | (1.6) | (2) | ||||||||
Cash Flow Hedges | Foreign currency contracts | Revenues | |||||||||||
Cash Flow and Fair Value Hedges | |||||||||||
Gains/(losses) reclassified from AOCL into earnings | 14.2 | (14.9) | 4.8 | ||||||||
Amount excluded from effectiveness testing recognized in earnings based on an amortization approach | 11.5 | 4.3 | |||||||||
Amount excluded from effectiveness testing recognized in earnings based on changes in fair value | $ 2.9 | $ 7.5 | |||||||||
Cash Flow Hedges | Foreign currency contracts | Other Income, net | |||||||||||
Cash Flow and Fair Value Hedges | |||||||||||
Amount excluded from effectiveness testing recognized in earnings based on changes in fair value | 9 | ||||||||||
Losses reclassified from AOCL into income resulting from forecasted transactions no longer probable of occurring | $ (1.4) |
Derivatives - Undesignated Hedg
Derivatives - Undesignated Hedges (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cash Flow and Fair Value Hedges | |||
Foreign exchange gains/(losses) on settlement assets and obligations, cash balances, and other assets and liabilities | $ (33.1) | $ (52.3) | $ 17.5 |
Not designated as hedges | |||
Cash Flow and Fair Value Hedges | |||
Gain/(Loss) recognized in Income on Foreign currency derivatives | 24.2 | 59.8 | (21) |
Not designated as hedges | Selling, general, and administrative | |||
Cash Flow and Fair Value Hedges | |||
Gain/(Loss) recognized in Income on Foreign currency derivatives | 23.9 | 58.6 | (20.5) |
Not designated as hedges | Revenues | |||
Cash Flow and Fair Value Hedges | |||
Gain/(Loss) recognized in Income on Foreign currency derivatives | $ 0.3 | 3 | |
Not designated as hedges | Other Income, net | |||
Cash Flow and Fair Value Hedges | |||
Gain/(Loss) recognized in Income on Foreign currency derivatives | $ (1.8) | $ (0.5) |
Borrowings - Outstanding Borrow
Borrowings - Outstanding Borrowings (Details) - USD ($) $ in Millions | Dec. 27, 2019 | Nov. 25, 2019 | Nov. 15, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 11, 2018 | Aug. 22, 2017 | Mar. 15, 2017 | Nov. 22, 2013 | Aug. 22, 2011 | Jun. 21, 2010 | Mar. 30, 2010 | Nov. 17, 2006 |
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 3,245 | $ 3,449.9 | |||||||||||
Fair value hedge accounting adjustments, net | (0.1) | ||||||||||||
Debt issuance costs and unamortized discount, net | (15.7) | (16.1) | |||||||||||
Total borrowings at carrying value | $ 3,229.3 | 3,433.7 | |||||||||||
Weighted-average effective interest rate (as a percent) | 4.00% | ||||||||||||
Commercial paper | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 245 | 125 | |||||||||||
Weighted-average effective interest rate (as a percent) | 2.10% | ||||||||||||
Notes due 2018 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 400 | ||||||||||||
3.350% notes due 2019 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 250 | $ 250 | |||||||||||
Stated interest rate (as a percent) | 3.35% | ||||||||||||
Repayment of unsecured notes | $ 250 | ||||||||||||
Floating rate notes due 2019 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 250 | $ 250 | |||||||||||
Repayment of unsecured notes | 250 | ||||||||||||
5.253% notes due 2020 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 324.9 | ||||||||||||
Stated interest rate (as a percent) | 5.253% | 5.253% | |||||||||||
Repayment of unsecured notes | $ 268.8 | $ 56.1 | 324.9 | ||||||||||
5.253% notes due 2020 | Interest rate contracts | |||||||||||||
Outstanding Borrowings | |||||||||||||
Cash payment received for terminated swap agreement | $ 0.9 | ||||||||||||
3.600% notes due 2022 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 500 | $ 500 | $ 100 | $ 400 | |||||||||
Stated interest rate (as a percent) | 3.60% | 3.60% | 3.60% | ||||||||||
4.250% notes due 2023 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 300 | $ 300 | $ 300 | ||||||||||
Stated interest rate (as a percent) | 4.25% | 4.25% | 4.25% | ||||||||||
2.850% notes due 2025 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 500 | $ 500 | |||||||||||
Stated interest rate (as a percent) | 2.85% | 2.85% | |||||||||||
Effective interest rate (as a percent) | 3.10% | ||||||||||||
6.200% notes due 2036 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 500 | $ 500 | $ 500 | ||||||||||
Stated interest rate (as a percent) | 6.20% | 6.20% | 6.20% | ||||||||||
6.200% notes due 2040 | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 250 | $ 250 | $ 250 | ||||||||||
Stated interest rate (as a percent) | 6.20% | 6.20% | 6.20% | ||||||||||
Term loan facility borrowing | |||||||||||||
Outstanding Borrowings | |||||||||||||
Total borrowings at par value | $ 950 | $ 950 | |||||||||||
Effective interest rate (as a percent) | 3.10% |
Borrowings - Maturity Schedule
Borrowings - Maturity Schedule of Borrowings (Details) $ in Millions | Dec. 31, 2019USD ($) |
Borrowings maturities at par value | |
Due after 1 year through 2 years | $ 47.5 |
Due after 2 years through 3 years | 547.5 |
Due after 3 years through 4 years | 395 |
Due after 4 years through 5 years | 760 |
Due after 5 years | $ 1,250 |
Borrowings - Narrative (Details
Borrowings - Narrative (Details) - USD ($) $ in Thousands | Dec. 27, 2019 | Nov. 25, 2019 | Aug. 22, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 18, 2018 | Jun. 11, 2018 | Mar. 15, 2017 | Oct. 31, 2016 | Nov. 22, 2013 | Dec. 10, 2012 | Aug. 22, 2011 | Jun. 21, 2010 | Mar. 30, 2010 | Nov. 17, 2006 |
Long-term and Short-term Debt Instruments | ||||||||||||||||
Weighted-average effective interest rate (as a percent) | 4.00% | |||||||||||||||
Total borrowings at par value | $ 3,245,000 | $ 3,449,900 | ||||||||||||||
Repayment of long-term debt | 824,900 | 414,400 | $ 500,000 | |||||||||||||
Commercial paper | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Threshold over which Commercial Paper Program limit will be reduced for borrowings on Revolving Credit Facility | $ 1,500,000 | |||||||||||||||
Maximum days to maturity | 397 days | |||||||||||||||
Weighted-average effective interest rate (as a percent) | 2.10% | |||||||||||||||
Weighted-average term | 3 days | |||||||||||||||
Total borrowings at par value | $ 245,000 | 125,000 | ||||||||||||||
Revolving credit facility | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Maximum borrowing capacity | $ 1,500,000 | |||||||||||||||
EBITDA interest coverage ratio | 3 | |||||||||||||||
Interest rate margin on revolving credit facility (as a percent) | 1.10% | |||||||||||||||
Facility fee (as a percent) | 0.15% | |||||||||||||||
Revolver balance outstanding at the end of period | $ 0 | 0 | ||||||||||||||
Letter of credit sub-facility | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Maximum borrowing capacity | 250,000 | |||||||||||||||
Term loan facility borrowing | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 950,000 | 950,000 | ||||||||||||||
Maximum borrowing capacity | $ 950,000 | |||||||||||||||
EBITDA interest coverage ratio | 3 | |||||||||||||||
Outstanding borrowings under term loan facility | $ 575,000 | |||||||||||||||
Term loan facility, interest rate margin (as a percent) | 1.25% | |||||||||||||||
Repayment of long-term debt | 14,400 | |||||||||||||||
Effective interest rate (as a percent) | 3.10% | |||||||||||||||
2.850% notes due 2025 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 500,000 | $ 500,000 | ||||||||||||||
Stated interest rate (as a percent) | 2.85% | 2.85% | ||||||||||||||
Premium on early redemptions (as a percent) | 0.20% | |||||||||||||||
Repurchase provisions, percentage of principal | 101.00% | |||||||||||||||
Effective interest rate (as a percent) | 3.10% | |||||||||||||||
2.850% notes due 2025 | Maximum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 4.85% | |||||||||||||||
2.850% notes due 2025 | Minimum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 2.85% | |||||||||||||||
4.250% notes due 2023 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 300,000 | $ 300,000 | $ 300,000 | |||||||||||||
Stated interest rate (as a percent) | 4.25% | 4.25% | 4.25% | |||||||||||||
Premium on early redemptions (as a percent) | 0.25% | |||||||||||||||
Repurchase provisions, percentage of principal | 101.00% | |||||||||||||||
4.250% notes due 2023 | Maximum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 6.25% | |||||||||||||||
4.250% notes due 2023 | Minimum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 4.25% | |||||||||||||||
Floating rate notes due 2019 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 250,000 | $ 250,000 | ||||||||||||||
Repayment of unsecured notes | $ 250,000 | |||||||||||||||
3.600% notes due 2022 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 100,000 | $ 500,000 | $ 500,000 | $ 400,000 | ||||||||||||
Stated interest rate (as a percent) | 3.60% | 3.60% | 3.60% | |||||||||||||
Redemption price (as a percent) | 101.783% | |||||||||||||||
Accrued interest received upon issuance | $ 1,570 | |||||||||||||||
Premium on early redemptions (as a percent) | 0.25% | |||||||||||||||
Repurchase provisions, percentage of principal | 101.00% | |||||||||||||||
3.600% notes due 2022 | Maximum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 5.60% | |||||||||||||||
3.600% notes due 2022 | Minimum | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Effective interest rate (as a percent) | 3.60% | |||||||||||||||
3.350% notes due 2019 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 250,000 | $ 250,000 | ||||||||||||||
Stated interest rate (as a percent) | 3.35% | |||||||||||||||
Repayment of unsecured notes | $ 250,000 | |||||||||||||||
Notes due 2017 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 500,000 | |||||||||||||||
Notes due 2018 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 400,000 | |||||||||||||||
6.200% notes due 2040 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 250,000 | $ 250,000 | $ 250,000 | |||||||||||||
Stated interest rate (as a percent) | 6.20% | 6.20% | 6.20% | |||||||||||||
Premium on early redemptions (as a percent) | 0.30% | |||||||||||||||
Repurchase provisions, percentage of principal | 101.00% | |||||||||||||||
5.253% notes due 2020 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 324,900 | |||||||||||||||
Stated interest rate (as a percent) | 5.253% | 5.253% | ||||||||||||||
Repayment of unsecured notes | $ 268,800 | $ 56,100 | $ 324,900 | |||||||||||||
Debt instrument, original face amount | $ 303,700 | |||||||||||||||
Unamortized premium of debt instrument | $ 21,200 | |||||||||||||||
Premium given to note holders (as a percent) | 7.00% | |||||||||||||||
Total premium paid to redeem | $ 3,100 | |||||||||||||||
6.200% notes due 2036 | ||||||||||||||||
Long-term and Short-term Debt Instruments | ||||||||||||||||
Total borrowings at par value | $ 500,000 | $ 500,000 | $ 500,000 | |||||||||||||
Stated interest rate (as a percent) | 6.20% | 6.20% | 6.20% | |||||||||||||
Premium on early redemptions (as a percent) | 0.25% |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Long-Term Incentive Plan | |||
Volatility (as a percent) | 22.80% | 26.30% | 24.70% |
Options granted (shares) | 600,000 | ||
Expected term (in years) | 7 years 18 days | 6 years 18 days | 6 years 18 days |
Chief Executive Officer | |||
Long-Term Incentive Plan | |||
Expected term (in years) | 7 years | 6 years | 6 years |
Non-executive employees | |||
Long-Term Incentive Plan | |||
Options granted (shares) | 0 | 0 | 0 |
Director | |||
Long-Term Incentive Plan | |||
Expected term (in years) | 8 years | 7 years | 7 years |
Employee Stock Option | |||
Long-Term Incentive Plan | |||
Options expiration period | 10 years | ||
Award vesting period | 4 years | ||
Unrecognized compensation cost | $ 1.3 | ||
Weighted average recognition period | 2 years 7 months 6 days | ||
Expected term (in years) | 10 years | ||
Award vesting (as a percent) | 25.00% | ||
Restricted Stock Units | |||
Long-Term Incentive Plan | |||
Award vesting period | 4 years | ||
Award vesting (as a percent) | 25.00% | ||
Financial PSUs | |||
Long-Term Incentive Plan | |||
Award vesting (as a percent) | 100.00% | ||
Financial PSUs | Minimum | |||
Long-Term Incentive Plan | |||
Stock units granted that recipients receive as performance based restricted stock units (as a percent) | 0.00% | 0.00% | |
Financial PSUs | Maximum | |||
Long-Term Incentive Plan | |||
Stock units granted that recipients receive as performance based restricted stock units (as a percent) | 200.00% | 200.00% | |
TSR PSUs | |||
Long-Term Incentive Plan | |||
Award vesting period | 3 years | ||
Award vesting (as a percent) | 100.00% | ||
RSUs and PSUs | |||
Long-Term Incentive Plan | |||
Unrecognized compensation cost | $ 55.6 | ||
Weighted average recognition period | 2 years 1 month 6 days | ||
2015 LTIP | |||
Long-Term Incentive Plan | |||
Shares available for grant (shares) | 23,800,000 | ||
2015 LTIP | Employee Stock Option | Chief Executive Officer | |||
Long-Term Incentive Plan | |||
Long-term incentive award stock option awards (as a percent) | 20.00% | 20.00% | |
2015 LTIP | Restricted Stock Units | Executives excluding CEO | |||
Long-Term Incentive Plan | |||
Long-term incentive award restricted stock units (as a percent) | 30.00% | 30.00% | |
2015 LTIP | Restricted Stock Units | Chief Executive Officer | |||
Long-Term Incentive Plan | |||
Long-term incentive award restricted stock units (as a percent) | 10.00% | 10.00% | |
2015 LTIP | Restricted Stock Units | Senior Vice Presidents | |||
Long-Term Incentive Plan | |||
Long-term incentive award restricted stock units (as a percent) | 50.00% | 50.00% | |
2015 LTIP | Financial PSUs | |||
Long-Term Incentive Plan | |||
Award vesting period | 3 years | ||
2015 LTIP | Financial PSUs | Executives excluding CEO | |||
Long-Term Incentive Plan | |||
Long-term incentive award performance based restricted stock units (as a percent) | 50.00% | 50.00% | |
2015 LTIP | Financial PSUs | Chief Executive Officer | |||
Long-Term Incentive Plan | |||
Long-term incentive award performance based restricted stock units (as a percent) | 50.00% | 50.00% | |
2015 LTIP | Financial PSUs | Senior Vice Presidents | |||
Long-Term Incentive Plan | |||
Long-term incentive award performance based restricted stock units (as a percent) | 50.00% | 50.00% | |
2015 LTIP | TSR PSUs | Executives excluding CEO | |||
Long-Term Incentive Plan | |||
Long-term incentive award performance based restricted stock units (as a percent) | 20.00% | 20.00% | |
2015 LTIP | TSR PSUs | Chief Executive Officer | |||
Long-Term Incentive Plan | |||
Long-term incentive award performance based restricted stock units (as a percent) | 20.00% | 20.00% |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock Option Activity | |||
Outstanding at beginning of period | 6.2 | ||
Granted | 0.6 | ||
Exercised | (2.2) | ||
Cancelled/forfeited | (0.1) | ||
Outstanding at end of period | 4.5 | 6.2 | |
Options exercisable at end of period | 3.3 | ||
Weighted-Average Exercise Price | |||
Outstanding at beginning of period | $ 17.63 | ||
Granted | 17.68 | ||
Exercised | 16.26 | ||
Cancelled/forfeited | 18.49 | ||
Outstanding at end of period | 18.31 | $ 17.63 | |
Options exercisable at end of period | $ 18.17 | ||
Stock Options, Additional Disclosures | |||
Weighted-average remaining contractual term, outstanding at end of period (years) | 5 years 2 months 12 days | ||
Weighted-average remaining contractual term, options exercisable at end of period (years) | 4 years 1 month 6 days | ||
Aggregate intrinsic value, outstanding at end of period | $ 37.9 | ||
Aggregate intrinsic value, options exercisable at end of period | 28.6 | ||
Cash Proceeds from Exercise of Stock Options | |||
Cash received from exercise of stock options | 36.7 | $ 10.1 | $ 13 |
Tax benefit from exercise of stock options | 2.4 | 0.6 | 1.3 |
Intrinsic value of stock options exercised | $ 11.6 | $ 3.1 | $ 4 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - Activity of Restricted Stock Units and Performance-Based Restricted Stock Units (Details) shares in Millions | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Restricted Stock Activity | |
Non-vested at beginning of period | shares | 7.1 |
Granted | shares | 3.7 |
Vested | shares | (2.2) |
Forfeited | shares | (1.5) |
Non-vested at end of period | shares | 7.1 |
Restricted Stock Weighted-Average Grant-Date Fair Value | |
Non-vested at beginning of period | $ / shares | $ 17.69 |
Granted | $ / shares | 18.01 |
Vested | $ / shares | 17.55 |
Forfeited | $ / shares | 17.58 |
Non-vested at end of period | $ / shares | $ 17.92 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans - Impact on Earnings (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock-Based Compensation | |||
Stock-based compensation expense | $ (48.9) | $ (47.7) | $ (43.9) |
Income tax benefit from stock-based compensation expense | 8.5 | 8.3 | 12.8 |
Net income/(loss) impact | $ (40.4) | $ (39.4) | $ (31.1) |
Earnings/(loss) per share: | |||
Basic and diluted (USD per share) | $ (0.09) | $ (0.09) | $ (0.07) |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Assumptions for the Black-Scholes Option Pricing Model (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Stock options granted: | |||
Weighted-average risk-free interest rate (as a percent) | 2.50% | 2.80% | 2.10% |
Weighted-average dividend yield (as a percent) | 4.20% | 3.90% | 3.50% |
Volatility (as a percent) | 22.80% | 26.30% | 24.70% |
Expected term (in years) | 7 years 18 days | 6 years 18 days | 6 years 18 days |
Weighted-average grant date fair value (USD per share) | $ 2.56 | $ 3.66 | $ 3.39 |
Segments - Narrative (Details)
Segments - Narrative (Details) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2019USD ($)segmentregioncustomer | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Segments | ||||||
Restructuring-related expenses and business transformation expenses | $ 16.6 | $ 91.5 | $ 7.4 | $ 115.5 | $ 94.4 | |
Goodwill impairment charge | $ 0 | $ 0 | 464 | |||
Utilized to allocate revenue to the country where the transaction is initiated (as a percent) | 100.00% | |||||
Assets held for sale | $ 49.3 | $ 49.3 | ||||
NYDFS Consent Order | ||||||
Segments | ||||||
Settlement expense | 60 | |||||
Joint Settlement Agreements | ||||||
Segments | ||||||
Settlement expense | 8 | |||||
Business Solutions | ||||||
Segments | ||||||
Goodwill impairment charge | 464 | |||||
Operating Segments | ||||||
Segments | ||||||
Number of operating segments | segment | 2 | |||||
Operating Segments | Consumer-to-Consumer | ||||||
Segments | ||||||
Number of consumers in money transfer | customer | 2 | |||||
Number of geographic regions in segment | region | 5 | |||||
Not Allocated To Segments | ||||||
Segments | ||||||
Restructuring-related expenses and business transformation expenses | $ 115.5 | 94.4 | ||||
Goodwill impairment charge | 464 | |||||
Settlement expense | $ 8 |
Segments - Reportable Segments
Segments - Reportable Segments Results (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues: | |||||||||||
Total consolidated revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Operating income: | |||||||||||
Total operating income | 226.5 | 197.4 | 258.9 | $ 251.2 | $ 271 | $ 302.6 | $ 283.6 | $ 264.9 | 934 | 1,122.1 | 475.8 |
Goodwill impairment charge | 0 | 0 | (464) | ||||||||
Restructuring-related expenses and business transformation expenses | $ (16.6) | $ (91.5) | $ (7.4) | (115.5) | (94.4) | ||||||
Depreciation and amortization: | |||||||||||
Total consolidated depreciation and amortization | 257.7 | 264.7 | 262.9 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 127.7 | 339 | 177.1 | ||||||||
Business Solutions | |||||||||||
Operating income: | |||||||||||
Goodwill impairment charge | (464) | ||||||||||
Operating Segments | |||||||||||
Operating income: | |||||||||||
Total operating income | 1,049.5 | 1,122.1 | 1,102.2 | ||||||||
Operating Segments | Consumer-to-Consumer | |||||||||||
Revenues: | |||||||||||
Total consolidated revenues | 4,407.8 | 4,453.6 | 4,354.5 | ||||||||
Operating income: | |||||||||||
Total operating income | 975.4 | 1,048.2 | 1,004.2 | ||||||||
Depreciation and amortization: | |||||||||||
Total consolidated depreciation and amortization | 194.5 | 189.9 | 183 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 97 | 273.8 | 120.2 | ||||||||
Operating Segments | Business Solutions | |||||||||||
Revenues: | |||||||||||
Total consolidated revenues | 388.8 | 386.8 | 383.9 | ||||||||
Operating income: | |||||||||||
Total operating income | 46.8 | 23.4 | 13.8 | ||||||||
Depreciation and amortization: | |||||||||||
Total consolidated depreciation and amortization | 39.6 | 41.9 | 42.5 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 7.7 | 11.9 | 8.8 | ||||||||
Operating Segments | Other | |||||||||||
Revenues: | |||||||||||
Total consolidated revenues | 495.5 | 749.5 | 785.9 | ||||||||
Operating income: | |||||||||||
Total operating income | 27.3 | 50.5 | 84.2 | ||||||||
Depreciation and amortization: | |||||||||||
Total consolidated depreciation and amortization | 23.6 | 32.9 | 37.4 | ||||||||
Capital expenditures: | |||||||||||
Total capital expenditures | 23 | 53.3 | 48.1 | ||||||||
Operating Segments | Other | Speedpay | Divestitures | |||||||||||
Revenues: | |||||||||||
Revenues | 125.4 | 352 | 368.3 | ||||||||
Operating income: | |||||||||||
Operating expenses | 98.2 | 251.2 | 246 | ||||||||
Operating Segments | Other | Paymap | Divestitures | |||||||||||
Revenues: | |||||||||||
Revenues | 5.3 | 16.2 | 19 | ||||||||
Operating income: | |||||||||||
Operating expenses | 2.2 | $ 6.7 | 6.5 | ||||||||
Not Allocated To Segments | |||||||||||
Operating income: | |||||||||||
Goodwill impairment charge | (464) | ||||||||||
NYDFS Consent Order | (60) | ||||||||||
Joint Settlement Agreements | (8) | ||||||||||
Restructuring-related expenses and business transformation expenses | $ (115.5) | $ (94.4) |
Segments - Information on Princ
Segments - Information on Principal Geographic Areas (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue: | |||||||||||
Revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Long-lived assets: | |||||||||||
Property and equipment, net | 186.9 | 270.4 | 186.9 | 270.4 | |||||||
Assets held for sale | 49.3 | 49.3 | |||||||||
Operating Segments | |||||||||||
Long-lived assets: | |||||||||||
Property and equipment, net | 236.2 | 270.4 | 236.2 | 270.4 | 214.2 | ||||||
United States | Operating Segments | |||||||||||
Revenue: | |||||||||||
Revenues | 1,896.1 | 2,126.2 | 2,159 | ||||||||
Long-lived assets: | |||||||||||
Property and equipment, net | 173.7 | 207.4 | 173.7 | 207.4 | 156.8 | ||||||
International | Operating Segments | |||||||||||
Revenue: | |||||||||||
Revenues | 3,396 | 3,463.7 | 3,365.3 | ||||||||
Long-lived assets: | |||||||||||
Property and equipment, net | $ 62.5 | $ 63 | $ 62.5 | $ 63 | $ 57.4 |
Quarterly Financial Informati_3
Quarterly Financial Information (Unaudited) - Summarized Quarterly Results (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summarized Quarterly Results | |||||||||||
Revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Expenses | 1,081.2 | 1,109.5 | 1,081.6 | 1,085.8 | 1,130.6 | 1,085.2 | 1,127.5 | 1,124.5 | 4,358.1 | 4,467.8 | 5,048.5 |
Operating income/(loss) | 226.5 | 197.4 | 258.9 | 251.2 | 271 | 302.6 | 283.6 | 264.9 | 934 | 1,122.1 | 475.8 |
Other income/(expense), net | (29) | (35.2) | 486.7 | (35.1) | (36) | (36.2) | (28.1) | (30.4) | 387.4 | (130.7) | (128.3) |
Income/(loss) before income taxes | 197.5 | 162.2 | 745.6 | 216.1 | 235 | 266.4 | 255.5 | 234.5 | 1,321.4 | 991.4 | 347.5 |
Provision for income taxes | 62.1 | 27.2 | 130.8 | 43 | 22.9 | 57.8 | 37.9 | 20.9 | 263.1 | 139.5 | 904.6 |
Net income/(loss) | $ 135.4 | $ 135 | $ 614.8 | $ 173.1 | $ 212.1 | $ 208.6 | $ 217.6 | $ 213.6 | $ 1,058.3 | $ 851.9 | $ (557.1) |
Earnings per share: | |||||||||||
Basic (USD per share) | $ 0.32 | $ 0.32 | $ 1.43 | $ 0.40 | $ 0.48 | $ 0.47 | $ 0.48 | $ 0.46 | $ 2.47 | $ 1.89 | $ (1.19) |
Diluted (USD per share) | $ 0.32 | $ 0.32 | $ 1.42 | $ 0.39 | $ 0.48 | $ 0.46 | $ 0.47 | $ 0.46 | $ 2.46 | $ 1.87 | $ (1.19) |
Weighted-average shares outstanding: | |||||||||||
Basic (shares) | 419.5 | 423.3 | 430 | 437.7 | 442.9 | 446.8 | 457.2 | 460.3 | 427.6 | 451.8 | 467.9 |
Diluted (shares) | 424.7 | 426.8 | 432.3 | 439.9 | 445.4 | 449 | 459.6 | 463.6 | 430.9 | 454.4 | 467.9 |
Quarterly Financial Informati_4
Quarterly Financial Information (Unaudited) - Parenthetical (Details) - USD ($) $ in Millions | May 09, 2019 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2017 |
Summarized Quarterly Results | ||||||||||
Restructuring-related expenses and business transformation expenses | $ 16.6 | $ 91.5 | $ 7.4 | $ 115.5 | $ 94.4 | |||||
Gain on sale | $ 524.6 | |||||||||
Adjustments related to Tax Act | $ 8.1 | $ 26.6 | $ (6.2) | $ (6) | ||||||
Speedpay | Divestitures | Other services | ||||||||||
Summarized Quarterly Results | ||||||||||
Gain on sale | $ 523 |
Schedule I - Condensed Financ_2
Schedule I - Condensed Financial Information of the Registrant - Condensed Balance Sheets (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets: | ||||
Cash and cash equivalents | $ 1,450.5 | $ 973.4 | ||
Property and equipment, net of accumulated depreciation of $24.8 and $33.5, respectively | 186.9 | 270.4 | ||
Other assets (Note 10) | 762.9 | 616 | ||
Total assets | 8,758.5 | 8,996.8 | ||
Liabilities: | ||||
Accounts payable and accrued liabilities | 601.9 | 564.9 | ||
Income taxes payable | 1,019.7 | 1,054 | ||
Borrowings | 3,229.3 | 3,433.7 | ||
Other liabilities (Note 10) | 498.3 | 279.1 | ||
Total liabilities | 8,798 | 9,306.6 | ||
Stockholders' equity/(deficit): | ||||
Preferred stock, $1.00 par value; 10 shares authorized; no shares issued | ||||
Common stock, $0.01 par value; 2,000 shares authorized; 418.0 shares and 441.2 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 4.2 | 4.4 | ||
Capital surplus | 841.2 | 755.6 | ||
Accumulated deficit | (675.9) | (838.8) | ||
Accumulated other comprehensive loss | (209) | (231) | ||
Total stockholders' deficit | (39.5) | (309.8) | $ (491.4) | $ 902.2 |
Total liabilities and stockholders' deficit | 8,758.5 | 8,996.8 | ||
Balance Sheet Parenthetical | ||||
Accumulated depreciation | $ 616.5 | $ 702.4 | ||
Preferred stock, par value (USD per share) | $ 1 | $ 1 | ||
Preferred stock, shares authorized | 10 | 10 | ||
Preferred stock, shares issued | 0 | 0 | ||
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 | ||
Common stock, shares authorized | 2,000 | 2,000 | ||
Common stock, shares issued | 418 | 441.2 | ||
Common stock, shares outstanding | 418 | 441.2 | ||
Parent Company | Reportable Legal Entities | ||||
Assets: | ||||
Cash and cash equivalents | $ 4 | $ 0.2 | ||
Property and equipment, net of accumulated depreciation of $24.8 and $33.5, respectively | 68.5 | 107.3 | ||
Other assets (Note 10) | 147.3 | 48.6 | ||
Investment in subsidiaries | 5,886.9 | 5,665.5 | ||
Total assets | 6,106.7 | 5,821.6 | ||
Liabilities: | ||||
Accounts payable and accrued liabilities | 58 | 100.2 | ||
Income taxes payable | 680.4 | 727 | ||
Payable to subsidiaries, net | 2,070.1 | 1,869.6 | ||
Borrowings | 3,229.3 | 3,433.7 | ||
Other liabilities (Note 10) | 108.4 | 0.9 | ||
Total liabilities | 6,146.2 | 6,131.4 | ||
Stockholders' equity/(deficit): | ||||
Preferred stock, $1.00 par value; 10 shares authorized; no shares issued | ||||
Common stock, $0.01 par value; 2,000 shares authorized; 418.0 shares and 441.2 shares issued and outstanding as of December 31, 2019 and 2018, respectively | 4.2 | 4.4 | ||
Capital surplus | 841.2 | 755.6 | ||
Accumulated deficit | (675.9) | (838.8) | ||
Accumulated other comprehensive loss | (209) | (231) | ||
Total stockholders' deficit | (39.5) | (309.8) | ||
Total liabilities and stockholders' deficit | 6,106.7 | 5,821.6 | ||
Balance Sheet Parenthetical | ||||
Accumulated depreciation | $ 24.8 | $ 33.5 | ||
Preferred stock, par value (USD per share) | $ 1 | $ 1 | ||
Preferred stock, shares authorized | 10 | 10 | ||
Preferred stock, shares issued | 0 | 0 | ||
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 | ||
Common stock, shares authorized | 2,000 | 2,000 | ||
Common stock, shares issued | 418 | 441.2 | ||
Common stock, shares outstanding | 418 | 441.2 |
Schedule I - Condensed Financ_3
Schedule I - Condensed Financial Information of the Registrant - Condensed Statements of Income/(Loss) and Comprehensive Income/(Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
CONDENSED STATEMENTS OF INCOME/(LOSS) AND COMPREHENSIVE INCOME/(LOSS) | |||||||||||
Revenues | $ 1,307.7 | $ 1,306.9 | $ 1,340.5 | $ 1,337 | $ 1,401.6 | $ 1,387.8 | $ 1,411.1 | $ 1,389.4 | $ 5,292.1 | $ 5,589.9 | $ 5,524.3 |
Expenses | 1,081.2 | 1,109.5 | 1,081.6 | 1,085.8 | 1,130.6 | 1,085.2 | 1,127.5 | 1,124.5 | 4,358.1 | 4,467.8 | 5,048.5 |
Operating income | 226.5 | 197.4 | 258.9 | 251.2 | 271 | 302.6 | 283.6 | 264.9 | 934 | 1,122.1 | 475.8 |
Gain on divestitures of businesses (Note 4) | 524.6 | ||||||||||
Interest income | 6.3 | 4.8 | 4.9 | ||||||||
Interest expense | (152) | (149.6) | (142.1) | ||||||||
Other income/(expense) | 8.5 | 14.1 | 8.9 | ||||||||
Income tax (expense)/benefit | (62.1) | (27.2) | (130.8) | (43) | (22.9) | (57.8) | (37.9) | (20.9) | (263.1) | (139.5) | (904.6) |
Net income/(loss) | $ 135.4 | $ 135 | $ 614.8 | $ 173.1 | $ 212.1 | $ 208.6 | $ 217.6 | $ 213.6 | 1,058.3 | 851.9 | (557.1) |
Other comprehensive income, net of tax | 22 | 28.3 | (65.1) | ||||||||
Comprehensive income/(loss) | 1,080.3 | 880.2 | (622.2) | ||||||||
Parent Company | Reportable Legal Entities | |||||||||||
CONDENSED STATEMENTS OF INCOME/(LOSS) AND COMPREHENSIVE INCOME/(LOSS) | |||||||||||
Gain on divestitures of businesses (Note 4) | 524.6 | ||||||||||
Interest expense | (181.5) | (197.6) | (177) | ||||||||
Other income/(expense) | 2.7 | (1) | (0.6) | ||||||||
Income/(loss) before equity in earnings/(losses) of affiliates and income taxes | 345.8 | (198.6) | (177.6) | ||||||||
Equity in earnings/(losses) of affiliates, net of tax | 827.3 | 997.2 | (436.1) | ||||||||
Income tax (expense)/benefit | (114.8) | 53.3 | 56.6 | ||||||||
Net income/(loss) | 1,058.3 | 851.9 | (557.1) | ||||||||
Other comprehensive income, net of tax | 0.2 | 1.6 | 2.1 | ||||||||
Other comprehensive income/(loss) of affiliates, net of tax | 21.8 | 26.7 | (67.2) | ||||||||
Comprehensive income/(loss) | $ 1,080.3 | $ 880.2 | $ (622.2) |
Schedule I - Condensed Financ_4
Schedule I - Condensed Financial Information of the Registrant - Condensed Statements of Cash Flow (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities | ||||
Net cash provided by/(used in) operating activities | $ 914.6 | $ 821.3 | $ 742 | |
Cash flows from investing activities | ||||
Purchases of property and equipment and other | (48.1) | (136.7) | (69.1) | |
Proceeds from divestitures of businesses, net of cash divested (Note 4) | 711.7 | |||
Net cash provided by/(used in) investing activities | 632.3 | (328.8) | (204.6) | |
Cash flows from financing activities | ||||
Net proceeds from commercial paper | 120 | 125 | ||
Net proceeds from issuance of borrowings | 495.9 | 685.4 | 746.2 | |
Principal payments on borrowings | (824.9) | (414.4) | (500) | |
Proceeds from exercise of options and other | 36.7 | 10.1 | 13 | |
Cash dividends paid | (340.8) | (341.7) | (325.6) | |
Common stock repurchased | (552.6) | (412.4) | (502.8) | |
Net cash used in financing activities | (1,069.8) | (357.2) | (570.5) | |
Net change in cash, cash equivalents, and restricted cash | 477.1 | 135.3 | (33.1) | |
Cash, cash equivalents, and restricted cash at beginning of year | 979.7 | 844.4 | 877.5 | |
Cash, cash equivalents, and restricted cash at end of year | 1,456.8 | 979.7 | 844.4 | $ 877.5 |
Supplemental cash flow information: | ||||
Cash paid for lease liabilities | 53.8 | |||
Non-cash lease liabilities arising from obtaining right-of-use assets (Note 6) | 269.1 | |||
Parent Company | Reportable Legal Entities | ||||
Cash flows from operating activities | ||||
Net cash provided by/(used in) operating activities | 103.1 | 539.1 | (605) | |
Cash flows from investing activities | ||||
Purchases of property and equipment and other | (9.9) | (78.9) | (0.7) | |
Proceeds from divestitures of businesses, net of cash divested (Note 4) | 711.7 | |||
Distributions received from/(capital contributed to) subsidiaries, net | 74 | (456.3) | 307.3 | |
Net cash provided by/(used in) investing activities | 775.8 | (535.2) | 306.6 | |
Cash flows from financing activities | ||||
Advances from subsidiaries, net | 194 | 345.5 | 868.3 | |
Net proceeds from commercial paper | 120 | 125 | ||
Net proceeds from issuance of borrowings | 495.9 | 685.4 | 746.2 | |
Principal payments on borrowings | (824.9) | (414.4) | (500) | |
Proceeds from exercise of options and other | 33.3 | 7.9 | 13 | |
Cash dividends paid | (340.8) | (341.7) | (325.6) | |
Common stock repurchased | (552.6) | (412.4) | (502.8) | |
Net cash used in financing activities | (875.1) | (4.7) | 299.1 | |
Net change in cash, cash equivalents, and restricted cash | 3.8 | (0.8) | 0.7 | |
Cash, cash equivalents, and restricted cash at beginning of year | 0.2 | 1 | 0.3 | |
Cash, cash equivalents, and restricted cash at end of year | 4 | 0.2 | 1 | 0.3 |
Supplemental cash flow information: | ||||
Non-cash investing activity, capital contribution to subsidiary (Note 3) | 916 | $ 591 | ||
Non-cash financing activity, distribution of note from subsidiary (Note 3) | $ 2,256.1 | $ 80.3 | ||
Cash paid for lease liabilities | 17 | |||
Non-cash lease liabilities arising from obtaining right-of-use assets (Note 6) | $ 124.8 |
Schedule I - Condensed Financ_5
Schedule I - Condensed Financial Information of the Registrant - Narrative (Details) - USD ($) $ in Millions | May 09, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 01, 2019 | Oct. 01, 2019 | Jun. 01, 2018 | Apr. 01, 2018 | Mar. 01, 2018 | Nov. 08, 2015 |
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Net assets subject to limitations | $ 610 | ||||||||||
Gain on sale | 524.6 | ||||||||||
Letters of credit outstanding and bank guarantees | 335 | ||||||||||
Speedpay | Divestitures | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Consideration from sale of business | $ 750 | ||||||||||
Speedpay | Divestitures | Other services | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Gain on sale | 523 | ||||||||||
Parent Company | Reportable Legal Entities | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Net assets subject to limitations | 610 | ||||||||||
Notes payable to subsidiary | $ 67.4 | $ 162.8 | $ 229.6 | $ 273 | $ 88.5 | ||||||
Stated interest rate (as a percent) | 1.61% | 1.69% | 2.34% | 2.12% | 1.96% | ||||||
Non-cash investing activity, capital contribution to subsidiary (Note 3) | $ 916 | $ 591 | |||||||||
Non-cash financing activity, distribution of note from subsidiary (Note 3) | $ 2,256.1 | $ 80.3 | |||||||||
Gain on sale | 524.6 | ||||||||||
Letters of credit outstanding and bank guarantees | $ 110 | ||||||||||
Parent Company | Reportable Legal Entities | Revolver - Parent Company | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Stated interest rate (as a percent) | 1.91% | 2.87% | |||||||||
Maximum borrowing capacity on unsecured borrowing facilities | $ 3,000 | ||||||||||
Outstanding borrowings on unsecured financing facilities | $ 993.6 | $ 914.6 | |||||||||
Parent Company | Reportable Legal Entities | Speedpay | Divestitures | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Consideration from sale of business | 750 | ||||||||||
Parent Company | Reportable Legal Entities | Speedpay | Divestitures | Other services | |||||||||||
NOTES TO CONDENSED FINANCIAL STATEMENTS | |||||||||||
Gain on sale | $ 523 |
Schedule I - Condensed Financ_6
Schedule I - Condensed Financial Information of the Registrant - Lease (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Lessee, Lease, Description [Line Items] | |||
ROU asset | $ 199.7 | ||
Balance sheet location of ROU asset | us-gaap:OtherAssets | ||
Lease liability | $ 242.3 | ||
Balance sheet location of lease liability | us-gaap:OtherLiabilities | ||
Total rent expense under operating leases, net of sublease income | $ 59.5 | $ 51.1 | |
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||
Weighted Average Lease Terms and Discount Rates | |||
Weighted average remaining lease term | 7 years 7 months 6 days | ||
Weighted average discount rate | 6.50% | ||
Maturities of Operating Lease Liabilities | |||
Due within 1 year | $ 53.2 | ||
Due after 1 year through 2 years | 45.2 | ||
Due after 2 years through 3 years | 38.5 | ||
Due after 3 years through 4 years | 32.6 | ||
Due after 4 years through 5 years | 30.5 | ||
Due after 5 years | 102.5 | ||
Total future minimum lease payments | 302.5 | ||
Less imputed interest | (60.2) | ||
Operating lease liabilities | $ 242.3 | ||
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Lease terms | 1 year | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Lease terms | 11 years | ||
Lease extension terms | 10 years | ||
Reportable Legal Entities | Parent Company | |||
Lessee, Lease, Description [Line Items] | |||
ROU asset | $ 66.5 | ||
Balance sheet location of ROU asset | us-gaap:OtherAssets | ||
Lease liability | $ 105.7 | ||
Balance sheet location of lease liability | us-gaap:OtherLiabilities | ||
Lessee, Operating Lease, Existence of Option to Extend [true false] | true | ||
Weighted Average Lease Terms and Discount Rates | |||
Weighted average remaining lease term | 10 years 6 months | ||
Weighted average discount rate | 5.70% | ||
Maturities of Operating Lease Liabilities | |||
Due within 1 year | $ 12.9 | ||
Due after 1 year through 2 years | 13.2 | ||
Due after 2 years through 3 years | 13.5 | ||
Due after 3 years through 4 years | 13.8 | ||
Due after 4 years through 5 years | 14.2 | ||
Due after 5 years | 74.5 | ||
Total future minimum lease payments | 142.1 | ||
Less imputed interest | (36.4) | ||
Operating lease liabilities | $ 105.7 | ||
Reportable Legal Entities | Parent Company | Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Lease terms | 1 year | ||
Reportable Legal Entities | Parent Company | Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Lease terms | 11 years | ||
Lease extension terms | 10 years |